Terraced house with management fee

[DublinDoris2000]

We've seen a lovely house we like in South Dublin. There is one issue, which I'm not sure is an issue. Its a freehold terrace, but within a small gated estate of 6 houses, and there is a management fee. The management board is made up of the owners and a solicitor.
The fee isn't huge so Im not worried about that. More that would the fact that it's on a small private estate with a management fee impact on resale desirability/ price? I always imagined that if I owned a house, I would own the land and there would be no strings!

What would worry me is the fee suddenly going up. I’ve heard of this happening.

The management is made up of then owners, rather than a business, so I'm not too worried about that.

I have a similar set up.

It entirely depends on the other owners. If you all get on and are sensible, it's great.

Add in a few mad arseholes, and it becomes stressful and/or expensive.

Tricky to judge in advance though!

If it’s owned by the freeholders with each of you having a share, then you can all monitor what’s needed. I would steer clear if it’s run by a company who can profit from increasing estate charges. Be aware you’ll be responsible for maintaining the road, lighting etc.

How are decisions made, do you need consensus or just a majority? It would be frustrating if one owner could prevent much needed repairs.

What does the management board have responsibility for? Is a private road, private sewer etc?

I do need more info but it's a very small estate of 6 houses. Common areas include the lane and parking to the front of the terrace, CCTV , electric gate and a tuning but of planting. So small private road. Sewer is a good question.

Small bit of planting!

There isn't an external management company involved with a profit motive which is good. Look at the terms of the management board, e.g. what happens if someone doesn't pay their fees, majority or 100% consensus required for decisions, what facilities are they responsible for.

Will it impact of future resale / price - well, you're nervous, so so some future potential buyers would be too. Some current ones too, no-doubt, and perhaps your buying price reflects this. As it's a dream house, I'd be very tempted to buy it.

This is fairly common in small private developments that have an electric gate access etc. As a future buyer i'd definitely see it as a bad thing. It wouldn't put me off necessarily, but i'd value an equivalent house without the aggro at a higher amount.

I wouldn’t have a problem with it, unless your budget was so tight you couldn’t afford the extra cost. You get what you pay for - nicer surroundings rather than relying on the council to cut the verges. Definitely better being run by the owners rather than a separate profit making management company too. Just get a copy of their accounts and constitution/ articles etc as part of the legal side.

The fact the management board is made up of owners and a solicitor is encouraging. Before proceeding I'd want to know how decisions would be made if a consensus can't be reached between all of the owners. Also, is money regularly being put into a sink fund in case of unforeseen maintenance/repairs in the future? I'd be worried if there wasn't, as better that than being landed with a huge unexpected bill in a few years. How are the annual increases calculated and what have the increases been over the last five years? There should also be annual accounts and AGM minutes that you and your solicitor can check for any issues or disputes. I've heard of this set up working very well if all owners are of a like mind and the company is well run, but I've also owned a property in a similar situation where one particular owner resented paying for anything and there were no procedures in place to deal with it- it made any kind of maintenance work incredibly painful and stressful.

@Zarene

I have a similar set up.

It entirely depends on the other owners. If you all get on and are sensible, it's great.

Add in a few mad arseholes, and it becomes stressful and/or expensive.

Tricky to judge in advance though!

This

Thanks for all your replies. This isn't our forever home, we're planning to move on 5 to 7 years. So it sounds like the estate management isn't a deal breaker but could cause other buyers to pause, just like it has done for me.