Taking ownership of multi-unit living
This meant owners had no say in how their development was being run or in how service charges were levied. Some developers refused to pay service charges for their unsold units.
In a move welcomed by owners, the MUD Act mandated that developers must transfer ownership of the common areas to the OMC by September 30th last, and in future new development, before any sales occur.
The other issue for multi-unit development owners has been the variability of service among managing agents.
Mark Boyle is a representative of the Apartment Owners Network, a group formed after Dublin City Council organised a public meeting for apartment owners in 2007.
He cites examples of rogue managing agents who unilaterally assumed the identity and powers of the management company and others who have refused to disclose the names of OMC directors to residents.
Kevin lives in a two-bed apartment in a mixed development that includes houses and shops in Kildare. He says while he pays an annual service charge of €1,200, poor service from the previous managing agent meant other residents had stopped paying.
He became a director of his OMC to get more transparency. He doesn’t want to be identified, as the new agent he and his fellow directors have hired is pursuing his neighbours for unpaid service charges amounting to €60,000.
“At last year’s agm we were all fighting. This year it was a feeling things were normalising – that’s important for residents. I think if the majority of residents are paying the fees, then everyone will pay the fees.”
In a bid to weed out incompetent managing agents, since July 1st, all must now be licensed by the Property Services Regulatory Authority (PSRA), which can inspect their operations and revoke their licences or impose fines of up to €250,000 for improper conduct.
Siobhan Dwyer, chair of the property and facilities management professional group of the Society of Chartered Surveyors Ireland, welcomes the move but says owners have to get more involved too.
“The management company won’t operate itself, it needs the active involvement of a group of owners.” She says OMCs are facing a funding timebomb caused by owners who are dodging their legal obligation and making a mockery of their neighbours by refusing to pay service charge fees. She estimates between 15 and 20 per cent of owners aren’t paying.
She says while a good managing agent will work with those who can’t pay on a payment plan, those who won’t pay are a problem the MUD Act has failed to legislate for.
“The legal process for the recovery of service charges is very slow, burdened with procedural rules, and it’s very expensive,” she says. “This really infuriates compliant owners, to know their funds are not being used to manage the estate but to chase others for not paying.”
Managing director of Erin Property Management, TJ Farrelly says with just 10 per cent of owners showing up to management company agms, he’d love to see more residents getting involved.
“An awful lot of people bought properties without realising that they have to be involved. If you built a house, you’d have to keep it clean, have the boiler serviced, and do the gardens or the gutters. In a development, those services are shared.”
He says in many developments the number of owner-occupiers is small, with buy-to-let owners sometimes less interested in maintaining services so long as they get their rent.