Service Charges and Accounting
What is a service charge for and do I have to pay it?
Your service charge is made to pay for all the services that are provide by your freeholder or residents management company (RMC) to maintain the communal areas of your block or estate. These will include maintenance and repair, insurance of the building, lighting and cleaning of common areas etc. Usually the charges will also include the cost of management, either by the landlord or by a professional managing agent.
Details of what can (and cannot) be charged by the landlord and the proportion of the charge to be paid by the individual leaseholder will all be set out in the lease. Service charges will vary from year to year; they can go up or down without any limit other than that they are reasonable.
Most modern leases allow for the collection of service charges in advance, repaying and surplus or collecting any shortfall at the end of the year.
Where do you keep my service charge money?
Every Residents Management Company that we manage has its own separate bank account and you pay your service charges directly into this account. We use up to date industry specific Qube software to manage our accounting and Justina, our account manager, will answer any questions you have regarding our accounting processes.
Can I see what my service charge is spent on?
Yes. We are aware that it is a big responsibility to spend your money and every year we send out a budget and a statement showing how moneys are dispersed with your service charge statement. Directors of Residents Management Companies will have up to date information about expenditure as agreed and we see the original invoices for any works. Any lessee is welcome to visit our offices to view invoices (this by arrangement to ensure the block manager can be available).
How is my service charge calculated?
Your service charge is calculated in accordance with your lease. Every year your block manager will meet with your Residents Company Directors or freeholder and discuss a budget based on your previous spending, any works planned in the year and any reserve funds that are collected.
What is a reserve fund?
Some leases allow for the collection of additional money on top of what is set out in the annual budget for maintenance, for large expensive future works such as roof replacements. This money is set aside in a separate reserve fund until required for these works
Day to Day issues of Living in Flats
My neighbours are causing a nuisance. What can I do?
As your managing agent, we will do our best to assist you if you report anti-social behaviour from a neighbour. As we are responsible for looking after the common areas of your estate and cannot control an individual’s behaviour, there is a limit to the powers we do have.
What we can do
- Write to all lessees with a reminder about the terms of the lease and the importance of being a good neighbour
- Write to specific repeat offenders where there is some evidence regarding anti-social behaviour
- Write to absent lessees regarding reported behaviour of their tenants
- Discuss enforcement of good behaviour and the terms of a lease with the directors of your Residents Management Company and take any actions agreed (e.g. the installation of parking schemes or CCTV)
- Visit and discuss the issues with your neighbour
- Signpost you to local authorities who can assist with further action
Managing agents cannot take legal action against fellow lessees unless
- This is specifically allowed for in the lease
- It is agreed with Directors of your Residents Management Company (RMC)
- You as the complainant agrees to indemnify the RMC for costs of the action
For any further information we recommend you consult your Local Council or Which-Consumer Rights Advice
There is water leaking into my flat. What should I do?
If you have a neighbour upstairs, the first thing to do is to see if you can contact them by knocking on the door. They may be home not knowing that they have a problem and early intervention will minimise damage.
If your neighbour is not home, or there is no apartment above you, report water ingress to your managing agent as soon as possible. You must do what you can to minimise any damage by moving furniture out of the area, for example. The managing agents will provide insurance details so that you can make your claim for any damage and if the leak comes from a common part of the building (the roof, for example) will arrange a contractor to repair the area.
Sometimes it is difficult to know where a leak is coming from. If we are unable to identify the cause, Jennings and Barrett will ask our in house RICS Surveyor to attend or arrange for a specialist “leak find” contractor to find the cause of the problem.
Who chooses the suppliers and contractors who work in my apartment block?
Jennings and Barrett have a range of trusted local contractors that we can recommend. Often, directors to Residents Management Companies (RMC) or Right to Manage (RTM) companies have contractors they have employed previously to our management and wish to retain them. All contracts for regular work are reviewed annually and any lessee can make a recommendation for a contractor to bid for a contract (subject to any insurance, qualification and accreditation requirements). These and planned maintenance would usually require a Section 20 process to be followed. This statutory process allows for lessees to nominate contractors within the legislation.
Do you charge commission or management fee for arranging contractors?
All invoices are passed through transparently from contractors and utility suppliers, we do not add anything to these. We charge a pre-agreed management fee for Section 20 Works.
Directors of Residents Associations, Right to Manage Companies and Residents Management Companies
Is it easy to change Managing Agents?
Yes. Call us to discuss how this could work for you. We offer a free, no obligation consultation, meeting at your block if preferred so that we may understand any issues and we offer free advice about the best way to move forwards.
Will we be assigned a specific Block Manager?
Yes, you are assigned a specific block manager who will get to know your block in detail. With the administration and accounts support provided by the Block and Estate team, we can react quickly, thoughtfully and professionally to any issues.
What experience do you have as a block and estate managing company?
Jennings and Barrett have been looking after property since 1920 and has 40 years’ experience in Block and estate Management. Some of our management portfolio has been with us for all this time. We are ARMA accredited and employ our own in house RICS Surveyor. There is little that we haven’t had to deal with. We also manage residential and commercial lettings and sales.
What are your fees for Block Management?
We are keen to ensure that blocks and estates of all sizes are professionally looked after and aware that there is no “one size fits all” solution. We typically charge a fixed rate per unit, but for very small blocks of 2 – 3 flats will look at a minimum fixed charge for the full property depending upon the level of management that will be required. Call us on 0203 598 9665 and talk to one of our block managers to find out how we can support you and provide a quality service at the level you require.
I am a freeholder. Will you act for me?
Yes. Jennings and Barrett manage a number of blocks on behalf of the Freeholder to ensure that your Landlord obligations are properly discharged and that you are protected from any potential legal action in this regard.