First time buyers today may find a traditional house beyond
their means, so may be considering buying a flat. Flats in
Guernsey vary from a modest single bedroom flat in a converted
house to a penthouse apartment at the top of a brand new
development. They vary as much in price too, but buying a flat
is a good way for a first time buyer to get their foot on the first
rung of the housing ladder.
The owner of a flat in a smaller development may own a share in
other parts of the building, such as the main structure, hallways,
stairs and gardens. The parts of the property that are shared
between the owners are called common parts, because they are used
by each owner in common with other owners. When maintenance is
required each of the owners pays a share of the total cost of
maintaining the common parts. When larger works are undertaken
the cost can come as quite a shock.
In the case of a flat in a larger development the structure and
common parts will probably be owned by a management company, which
in turn is usually owned by the flat owners. The management
company will arrange for the structure and common parts to be
maintained and cleaned, but will then charge those costs back to
the owners of the flats by way of a service charge. The
management company may also have the right to ask owners to pay
some money on a regular basis in anticipation of larger
expenditure. A reserve from which the managing company can
draw is called a sinking fund. A service charge with a sinking
fund is a great way to budget for those more expensive works, but
some flat owners are surprised at the amount of the service
charge. Service charges range from about £600 a year to
more than £2,500. It is important to know how much you
will have to pay. It is also worth noting that any money paid into
a sinking fund, but not used, will not be returned to you when you
sell the flat.
Owners of smaller developments sometimes operate a sinking fund
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Many people are baffled by trusts, the purpose of which they don't fully comprehend. Some even regard them with suspicion, as tools of of opaque tax evasion strategies of a type favoured by wealthy individuals.
We were recently instructed by a Bank in relation to a regulatory matter. The Bank had made a suspicious activity report to the Financial Investigation Unit ("FIU") due to their concerns about the potential source of funds in an account.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).