Conveyancing on the purchase of an apartment in Ireland has its own unique legal intricacies. From multi-unit developments to common areas considerations, here are 10 key things you should know.
KEY TAKEAWAY POINTS EVERY APARTMENT BUYER SHOULD KNOW
- Freehold v Leasehold
- Lease Term
- Lease Covenants
- Common Areas
- Insurance
- Service Charges
- Sinking Fund
- Fire Safety
- Apartment Purchase – Conveyancing Timelines
- Apartment Purchase – Conveyancing Fees
- Micheal Burns of MB Solicitors is an expert in conveyancing for property services in Ireland. Call (01) 567 7343 or use the contact form below.
Freehold v Leasehold
All apartments are leasehold title. The reason all apartments are leasehold title is because you share the common areas and amenities with other apartment owners in the complex.
Leasehold title differs from Freehold title in that if you own the freehold title, you are the owner of the buildings and the land upon which those buildings sit. Under a Leasehold title you do not own the land or the building, you only own a right to occupy that building/apartment. The Lease will determine what conditions upon which you will occupy the apartment.
Lease Term
The Term of the Lease will dictate how long you can occupy the property. The term under the Lease usually ranges from 200 years to 999 years.
It is important to note that a term of less than 70 years is not considered to be good marketable title.
Lease Covenants
The Lease will set out certain conditions with which you must comply while you live in the apartment. The covenants include the obligation to pay the management company service charges, not to interfere with the use and enjoyment of other apartment owners in the complex. The Lease will also include certain rights such as the right to parking in the common areas.
It is important that you read each of the covenants contained in the Lease prior to signing the contract for sale.
Common Areas
In a new development the developer will transfer the common areas to the Management Company when the apartments are sold.
The management company is responsible for maintaining and repairing the common areas. The owners of the apartment are members of the management company and each owner has one vote at the AGM.
There are many developments in Ireland where the Developer has not transferred the common areas to the management company. During the property crash many developers were liquidated prior to the transfer of common areas having been complete.
As part of the title investigation, it is necessary to examine why the common areas have not been transferred and to understand what steps need to be taken n order to the transfer complete.
Insurance
Unlike buying a house, you do not have to buy home insurance for the building.
Before you complete the purchase of an apartment the Management company will add you to the block policy.
If you are using a mortgage to buy the property that mortgage company will also be noted on the block policy. You should consider buying insurance to cover any of your contents.
Service Charges
Service charges are annual fees payable to the management company. The fees cover the insurance, maintenance and repairs. Prior to completing the purchase it is necessary to make sure that the service charges have been paid up to date.
Sinking Fund
The management company is obliged to set up a sinking fund. This is to cover the cost of major repairs.
Fire Safety
It is not unusual for common areas to require updating to comply with fire safety regulations.
Such updating can be expensive and there may not be sufficient money in the sinking fund to cover the cost.
If there is not enough money in the sinking fund, each of the apartment owners will have to contribute to the cost. It is important to investigate whether there are any works anticipated that would likely affect the service charge or require the apartment owners to pay additional fees to the management company.
Your solicitor will inquire whether there has been a fire safety audit carried out and if so request a copy of the report from the management company.
Apartment Purchase – Conveyancing Timelines
The process can take approximately 8 weeks but this will depend on the complexity of the transaction.
MB Solicitors know that buying your home is one of the most stressful life events. We guarantee to keep you fully updated on all matters to ensure a smooth and stress-free process.
Apartment Purchase – Conveyancing Fees
This is an approximate guide to legal fess and outlay costs – get in touch below for a confirmed conveyancing quote.
| Professional fee | €1500 |
| VAT | €345 |
| Stamp duty | 1% of purchase price |
| Land Registry fee (registration of title) | €700 |
| Land Registry fee (registration of mortgage | €175.00 |
| Searches | €100 |
| Commissioner fee | €24 |
| Ne title deed | €40 |
Micheal Burns of MB Solicitors is an expert in conveyancing for property services in Ireland. Call (01) 567 7343 or use the contact form below.
