I saw a Dilbert cartoon once where two people were furiously trying to communicate via two computers. An angel then sweeps down, picks one of them up and carries them to the other. Face to face and able to converse properly they realised that talking was far better and the problem was resolved.

I'll call you both on Monday.

Oli

Hi

I think the confusion here relates to legal jargon. The owners of all leasehold properties throughout the world are generally known as 'tenants', because that is exactly what they are, in real terms. Freehold owners own the land outright, whereas leaseholders don't - they only have a right to use the land for a specific purpose and for a set length of time. A leaseholder is therefore a tenant or lessor, as far as the law is concerned. It is therefore very common for lease documents to refer to the 'tenant' as the liable person responsible for paying service charges, etc.

Tony B

No-one has actually picked up on the question re stage payments.

Does anyone know who checks the build on our behalf, and that when the Developer requests a payment, it is in fact a bone fide request?

It really seems odd to me that the builder cannot provide an approx schedule of payments, yet they come flying almost out of the blue with only 7 days to hand over the cash.

Hi Mouldy,

I attempted to post an email from TGC with regards to a purchase at Garden Heights to test my perception as it seemed to differ somewhat from a certain member of of PS staff with regard to this same subject. However it was removed. All I will say is because agencies who PS have engaged on their clients behalf don't seem to speak the same language and basically can't be bothered as us clients have paid upfront, by the time everyone had finally contacted each other and exchanged pertinent information 2 months had elapsed, resulting in a huge penalty fine which I had to pay.... As Oliver is well aware by private exchanges until certain 'accountability' and areas of responsibility are established, no more of my cash wiill be headed IPA's way.

IPA should not 'use' their clients to establish standards of customer service. We pay very generously for the inadequate standard!!!

Mark,

My experience is that the tennants contributions fall a long way short of the actual service charge.

E.g for Pelikan where the service charge is 650PLN the tennants only contribute 250PLN. This shortfall takes a big chunk out of the rent of !800PLN (not to mention all the other charges).


Regards

Alan

Thanks PalmTreeP, I take no comfort in knowing that I am not alone, and I agree with you entirely. I've invested large sums of money, time and energy (much more than I anticipated) in this project and no one appears to be accountable for any of the services provided. Mistakes have been made from the beginning, but I seem to be the only person who notices, or cares.

Oliver appears to be bemused by any kind of client dissatisfaction, and it seems to me that volumes of comment from like minded investors are quickly dismissed. I wish I could say that PS is not getting any more of my money, however I fear I have entered a black hole ...

Then this should be reflected in PS projections - why aren't they? PS keeps bigging up it's expertise, but in fact I'm learning my own lessons (and some very hard lessons ones) as I go along.

Any chance of some revised (realistic) projections PS on La Lumiere - given current interest rates, and exchange rates, rental revisions, updated service charges etc? That would be a service worth having. You can leave your marketing hats off - you have already reeled me in.

Mouldy,

You definitely need to work out you own cash flow figures as reality is a very long way from the PS forecasts.

For example the annual figures for my Pelikan unit are as below

NB this is based upon rolling all the one off costs into the capital spend and using PS's estimate of two months of voids per year. In reality although this unit took 2 months to let, I have another unit that is still not let after 5 months, so overall these figures are probably a bit optimistic.

Annual costs, furnished unit

Rental 22,000 (2,200 PLN pm x 10)
S/Charge 3,000 (tennants contribution 250 PLN pm)
----------------------------------------------
Total Income 25,000

S/Charge 7,800 (650 PLN pm)
Initial letting Fee 2,684 (1 months rent plus VAT)
Monthly Rednet fee 3,960 ( 396 PLN pm x 10)
Accountancy Poland 1,800 (150 PLN pm x 12)
Accountancy UK 450 (approx 120 pounds)
Furnishing costs 5,000 (25,000 PLN total costs depreciated over 5 years)
Insurance 600 (basic level building insurance costs)
I-Property 1,200 (£282 proxy landlord service)
----------------------------------------------
Total ongoing costs 24,294

Even without making any allowance for routine redecoration of the property or any unexpected costs, the rental income is almost entirely absorbed by the ongoing costs/chargers imposed by the developer, Rednet and I-Property.

I have an offer yet to be confirmed, for !800PLN unfurnished for my other unit - which again will just about cover the ongoing costs.

--------------------------------------------------------------------------------------------------------

In Summary

Rather than the projected 6% "hands off net yield", I am achieving around 0.1%.

Including finance costs, if they remain let, my units will cost me around £7,000 p.a each to keep.

Hi Alan,

I am finding the same extremely negative yield (after allowing for finance costs) for my Westland Court unit - & that was after finding a tenant straight away.

As you have rightly mentioned there is a large yearly cashflow required. Do you think the capital growth over the next 5 years will give a good enough total return to compensate for the ~ -5% yield given the risk we have taken on or do you think the money would be better invested elsewhere, for a better return given the risk?

Warning to novice investors considering getting on the CEE bandwagon - be very wary of the property secrets cashflow projections. You can end up in a lot of trouble if you aren't prepared for the 'surprise' expenses PS do not allow for.

Dear All,

A few years ago the analyst team at PS provided cash flow forecasts for developments in the investment details. These were provided with the best information at the time and various assupmtions were made. Averages were posted and estimations made. These were all clearly expressed as such in these documents and all investors were urged to conduct their own research to support those being presented by PS. PS subsequently pulled these as a guide because by using averages it meant that half of the clients were upset with the forecast.

Mouldy, you state that I am bemused. I totally agree where your particular comments are concerned. I have seen your client account and know exactly what the PS and i-PA team have done for you regarding your payments and mortgage. Your investment is not due to complete until September 09 so I am bemused by your involvement and critique of our service. You went to a mortgage provider recommended to you by your lawyer. May I remind you that we have helped to resolve your personal mortgage and stage payment situation which is not a service that we are contracted by you to provide.

Please call me so that we can discuss this as I get the impression that you are walking through different forum posts banging your drum. If you believe we have not helped you and not gone above the scope of our service contract, as I believe we have, then please contact me directly.

We have a full team knowledgeable in the investment experience of hundreds of clients. If you have any concerns then please call us where we are more than happy to help.

Regards

Oliver Watts