NEW PROPOSALS for the regulation of apartment management companies and agents could reduce the cost of annual service fees by up to 50 per cent if implemented, according to Fine Gael.
Launching details of its new policy document on the sector yesterday, the party’s environment spokesman, Phil Hogan TD, said the “potential” existed for “a cosy relationship” between providers of management services and developers. He said, however, that this could be addressed through regulation of the sector, as proposed in the party’s document, A Fairer Deal for Modern Living.
Mr Hogan estimated that the reduction in annual service fees could be as high as 50 per cent if the proposed measures were introduced. According to Fine Gael, there are more than 500,000 apartment dwellers, some 4,600 management companies, and more than 400 companies or individuals offering management services. But the party says that overcharging, developers “cross-subsidising” one development with another, and a lack of sinking funds for developments are significant problems.
Its new policy document proposes the creation of a single regulatory body for apartment management companies and others in the sector, as well as a requirement that service charges be calculated five years in advance.
Mr Hogan said the proposals would prevent homeowners from being “ripped off” by also requiring initial service charges to be calculated by a professional quantity surveyor.
Other key proposals are:
l The term “management company” should be changed to a not-for-profit “owners’ company”. The party says it would introduce legislation to ensure this term has a clear legal definition, setting out its core functions.
l The immediate introduction of legislation to place the National Property Services Regulatory Authority (NPSRA) on a statutory footing, including the power to regulate management companies.
l The merger of the Private Residential Tenancies Board with the NPSRA, to create a single “overarching” body for the property sector.
l A requirement for developers to convey the title of the building and common areas to the “owners’ company” within one year of completion.
l It should become an offence for property management agents to operate without a licence. They would also be required by law to disclose any commission or discounts to the members of the “owners’ company”.
Mr Hogan noted that the proposals included a provision whereby, if one person obtained a controlling interest in an “owners’ company” through owning a majority of the residences in an apartment complex, then they would not be allowed to “impose unreasonable or oppressive conditions on other shareholders”.