So Good afternoon and welcome to todays version of property blogpost.
We examined a management company accounts today and discovered that the way the service charges were being apportioned was completely off. Off? Yes off. The lease said to do it based on number of bedrooms. So a two bedroom cost a bit more than a 1 bedroom but less than a three bedroom. Common sense. But no, somewhere in the past a % scheme was introduced based on size of each apartment. Size, not number of bedrooms. So what is that about? Is it really different? Well on the face of it it should be fine. A three bedroom is larger than a 2 which is larger than a 1 bedroom, So % should work, right?
Well until you are the owner of a large three bedroom with a proper fee of about 1500 Euro per annum and your last bill based on % was 2,750 Euro!
What does it mean to a service charge?
The total money collected is the same, just the smallest were paying less than the formula. This shortfall is paid by the larger apartment owners.
Oh dear, what a row that will cause.
What to do next?
So check your lease, or get a professional to do so. Make sure that you are being apportioned your share of the service charge as per the lease!