Service Charges and other payments
If we provide shared services, such as cleaning and lighting to common areas or maintaining the grounds of shared gardens, you will be asked to pay a service charge. This total cost is divided into individual contributions payable by each homeowner. The terms of your lease or freehold documentation will detail what costs will be included.
If you have a apartment, the service charge will also include your contribution to the cost of maintaining the structure of the building and keeping common areas, such as halls and stairways, in good repair.
The service charge is normally collected monthly with your other payments. We set the charge by estimating the total cost of providing the services over a twelve-month period. If charges are too low to cover costs, we normally recover the shortfall through the next year’s charge. If we are left with a surplus at the end of the year, we offset this against the new charge.
The lease may allow us to share out the total cost to leaseholders by any method that we
consider reasonable; this is supported by legislation that requires landlords to set charges
in a reasonable manner. Alternatively, the lease may specify a particular method of charging, for example dividing the charge by the number of flats (and houses) in a block (or estate).
Your lease sets out how we apportion charges between flats in a block. Sometimes, there will be more than one calculation set out, because there may be other blocks of flats and, in some cases houses, that will also have to contribute to services or repairs carried out on your behalf.
Service charges can be billed for in advance. Leases usually state that this will be done monthly or quarterly. We will also accept weekly payments.
What is included in the service charge?
Although the lease or freehold documents will set out what is or can be included in the service charge, below are details of some of the most common service charge items:
- Lifts. The total annual cost of repairs, maintenance, insurance and depreciation for the lift in your block
- Cleaning and upkeep. The cost of providing a cleaning service
- Door entry systems. This is the cost of maintaining and replacing a door entry system and will vary according to the type of installation in your block
- TV aerial. The cost of providing a communal TV installation to the block, including replacement,depreciation and electricity
- Estate roads, drains, street lighting, storm water and sewage pumping stations. The charge covers repairs, maintenance, replacement and power supply. This only applies to roads and installations that are private, in other words, have not been adopted by the local authority
- Garden/landscaping maintenance. This is the cost of the contract and other work needed to maintain communal landscaping, car parking, road sweeping and removal of refuse on an estate
- Central heating/hot water. This only applies where heating and hot water are supplied from a central boiler. Costs will include a contribution to the actual heating and hot water costs for your own apartment and any heating or hot water provided to common parts
- Building insurance. Where we are required under the terms of the lease or freehold documentation to insure your building and review the charge annually
- Window cleaning. Where provided, this will be for the cleaning of windows located in the common parts.
- Day-to-day repairs, these relate to the costs of carrying out minor repair works to communal areas and the main structure.