Q&A

Communal rates - what's my fair share?:Q We live in a terrace of eight houses. About eight years ago we bought the house beside us and have incorporated it into one family home. What is the position of paying communal rates? We share the costs of keeping a small communal garden. The end-terrace house would be the same size as our two mid-terrace houses put together. In England they divide communal costs by square footage.

A You don't say if your house is in a managed development (typically a relatively new scheme) where annual service charges are paid by each homeowner. Such charges typically cover bins, upkeep of public areas, parking and gate maintenance, insurance, landscaping, etc and the pro rata level of charges is typically laid out in the lease. The charges are generally worked out on the basis of square footage - larger apartments/houses pay more. Though in a mixed development of houses and apartments, it's not unusual for houses to pay slightly less than apartments because of the high cost of lift maintenance. So look at your lease. If yours is a terrace of houses where there has been a longtime "gentleman's agreement" on the upkeep of the communal garden, with a resident going around and collecting the money and paying a gardener, then that's a different matter and one which you need to hammer out between you and, perhaps, put in writing on a more formal basis if someone has not already done so. But in the interest of neighbourliness, if it has always been the way that each house pays the same contribution, then it might be viewed as a little mean of you to start going down a very official, square footage route and could antagonise your neighbours. It is, after all, a small communal garden so the annual levy can't be that steep, even if you have to pay it on the double.

How do we know if we're in negative equity?

Q I read a headline that said 140,000 people are in negative equity. How do we know if we are. We bought, as first time buyers, our three-bed semi in Lucan in 2005.

A The predictions about negative equity are coming thick and fast. The number you refer to was made by Friends First economist Jim Power. Niall O'Grady from Permanent TSB has suggested that some house prices are now what they were in mid-2005 so that anyone who bought then with a 100 per cent mortgage is in negative equity. You would know soon enough if you were in negative equity if you went to sell your semi. If the price your house would fetch is less than the outstanding mortgage then you are in negative equity. So if a buyer was prepared to pay €320,000 and you still owed the bank €340,000 then you're in negative equity to the tune of €20,000.

But you don't say if you bought with a 100 per cent mortgage?The vast majority of buyers didn't. The key question is: are you planning/or need to sell? If not, and you intend staying in that house for years, then the negative equity issue is theoretical for you and you should not waste time thinking about it.

Your questions

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