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The number of apartments in Northern Ireland has grown significantly in the last 20 years, with more being built each year. From first time buyers to down-sizers, from city centre living to a holiday home by the sea, more people are choosing to buy apartments, and provided the apartment complex is running correctly, an apartment can be a sound investment.
When you buy an apartment, you buy the internal structures of that apartment. The remainder of the apartment building including the roof, exterior walls, hallways, lifts, communal doors, garden and car parking areas are all shared by all the apartment owners. These areas are usually referred to as “Common Areas”. Most apartment developments are set up in such a way that a Management Company is formed to take ownership and look after these common areas, dealing with important matters such as insurance and maintenance, which is funded by each apartment owner who pay a service charge. All the apartment owners are shareholders, and these shareholders organise how the management company runs the common areas. In smaller apartment blocks, shareholders may run the management company themselves, whereas in larger developments a professional managing agent, usually an estate agent, may be appointed by the management company.
If the management company is not fulfilling its obligations, this could cause you a number of difficulties, including ultimately not being able to sell your apartment.
What can go wrong
When you sell your apartment, the purchaser’s solicitor and their mortgage lender will carry out certain checks to make sure the management company is functioning properly. This includes but is not limited to the following;
If the answer to any of these questions is no, you may find you have difficulty in selling your apartment.
If your apartment management company is in difficulty, you may notice one or more of the following;
What can I do?
The good news is that in many cases, any problems can be resolved, but it can take some time and if you suspect there may be a problem, don’t wait until your apartment is on the market. Take action now to avoid jeopardising a future sale.
This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our Residential Conveyancing Team at Cleaver Fulton Rankin for further advice or information.