What is a Year End Balancing Charge?

At Inspired Property Management we like to make it clear and transparent with all our charges and what is involved in the service charge and balancing charge.

Many service charge payers do not realise that the charge they pay at the start of the service charge year is actually an interim payment. It is an initial estimate of future expenditure for maintaining the building and is not the final service charge payment. In fact the service charge payment cannot be considered to be finalised until after the completion of the service charge accounts.

The service charge accounts will compare the amount budgeted for the year with the amount actually spent. If the actual is more than the budget then a deficit will be produced, if less was spent than budgeted, there will be a surplus.

This balancing charge, which in the event of a surplus will actually be credit, will ensure that the service charge is no longer an estimate. After the charge is invoiced you will only have been billed for the services/work carried out during the service charge year.

Previous Owner

Once you purchase a lease you become responsible for it; this includes the liabilities of the previous owner. For this reason solicitors should always ensure that arrangements are made for the payment of any outstanding service charges prior to the lease changing hands. They should also make enquiries into the financial position of the service charge and determine if a retention is required in case of a deficit.

18 Month Rule

18 Month Rule – As a leaseholder you can only be charged for expenditure within 18 months of the landlord or management company incurring the costs. This includes the balancing charge. This is the reason why service charge accounts have to be produced within 6 months of the year end (18 months from the year start and the first expenditure). However you may find that this is not the case, instead you could receive a section 20b notice, which provides a summary of charges. This provides the landlord or management company more time to produce accurate accounts and should also give you notice of the possibility of a deficit or surplus.

You may find that even though the accounts are produced within 6 months the charges are not applied for some time after this. This is perfectly fine as long as your landlord or management company provide a notice with the accounts (usually in the form of a covering letter) stating that there is a deficit and you will be invoiced for a balancing charge.

Ensure you read your Lease as it’s not 100% guaranteed that balancing charges will be required. Leases are all different and some may not have the provision for balancing charges. Some leases have the provision to recover a deficit position by charging however there is no provision to credit back a surplus.

If you have any questions about your Lease and would like further information about services charges please take a look at the FAQ section on our website where we have answered some of the common questions we get asked.

Benefits of a gym in your development or apartment block

There are many benefits to having a residential gym in your development or apartment block. It encourages people to exercise, increases the value of a property, and builds an excellent community amongst tenants and home owners.

Residential gyms are now at the forefront of a property developer’s mind when designing accommodation. They are now a key feature that sets properties apart in an already fiercely competitive market.

According to a 2018 survey, the UK fitness market is growing at an incredible rate. It’s currently the fastest growing business sector in the country, with an annual growth rate of 8.5%. In simple terms – people today care about getting fit and healthy as part of their lifestyle.

IPM have outlined the top benefits of having a residential gym:

The biggest barrier of going to the gym is the convenience factor. Waking up in the morning and knowing that there’s a gym 30 seconds away can make the world of difference to tenants.

Some of us need a little more motivation when it comes to getting up early and having a good workout. Building a gym is a fantastic way of encouraging people to commit to staying healthy.

The fact that residents do not need to leave the building means they are free to use their own bathroom.

Being able to go home after a workout to use your own shower full of your specific products, towels etc. is such a great advantage.

Returning to your own flat after a workout at your residential gym also means avoiding otherwise busy changing rooms at peak hours in any other gym. This leaves you free to change in the peace and quiet of your own home with no queues.

Most residential gyms are big enough to accommodate a wide range of equipment, giving users a level of variety in their workout, which is hard to get from a personal gym.

Let’s face it, bad weather can stop even the most committed keep-fit fan from leaving the house for a run – especially in winter months. Having a gym in the same building that caters to running, rowing, weights etc. makes exercise far more tempting.

Residential gyms can help to build a community for users and their guests. It’s easy to get to know your neighbours when you work out together. You can encourage each other, motivate each other and become real gym buddies.

For more information about how we could assist with managing your property and our experience of luxury developments with gyms please get in touch with a member of our team 01302 729 500.

Top 5 Property Management Tech trends to watch out for

The rise of “Proptech”

For all its intriguing, futuristic promise, “proptech” is still a rather nebulous concept. While developers or investors look to contain ever-expanding technology into bricks and mortar assets, proptech might mean anything from installing facial-recognition security sensors to tracking energy usage. It might involve enabling occupier employees to customise individual heating preferences with a smart phone app, or using sensors to follow individuals’ movements.

The Cloud

Rewind to a few years ago, “the cloud” was seen as a mysterious pocket of the internet that eluded principals and agents alike. Fast forward to now and the cloud is fast becoming the norm and legacy server-based software is quickly becoming obsolete.

This is due to the many benefits of cloud property management software including time and cost savings, scalability, increased security and greater accessibility. Additionally, cloud-based systems have client access which allow tenants and owners to log in and see their property and financial information 24/7, reducing the amount of communication required. At IPM was have already invested in the technology to allow all our tenants fuse free access anytime, anywhere using the on-line tenant portal.

Augmented reality and virtual reality

With VR, potential buyers and renters can virtually view a property from anywhere in the world, at any time. This means that the property is open for inspection 24/7, allowing agents and clients to save time and money while increasing efficiency and engagement.

Meanwhile augmented reality (AR) apps superimpose a computer-generated image of an object into real life, allowing people to do things like capture Pokemon (if that’s your thing) or virtually decorate a space using their phones or tablets. For brokers and developers, they’ll be able to showcase the potential of an unfinished space using AR to present a desired lifestyle and decrease time on market.

The chat bots

The modern consumer expects immediacy. They want answers to their questions and they want them now. That’s where property management robots like chatbots, voice bots and virtual assistants come in. Not only can they help answer consumer queries with little to no delay to keep consumer expectations at bay, but they can also free up your time to focus on what really matters.

Push technology

Another property management tech trend to watch this year is push technology. While this technology has been around for a few years, it has become increasingly popular as more and more agencies develop their own smartphone apps.

Agencies can use push technology to send content alerts to a smartphone’s locked screen and other notification areas in order to get users back on the app again and generate leads (phone calls).

Inspired Property Management take a view to invest in technology that not only offers our clients and tenants a better service but also allows them to manage their accounts freely and easily. For more information about how you can use our tenant portal click on the link here.

What will Brexit mean for property prices?

Whether you’re a staunch remainer or avid Brexiteer, there’s no denying that the uncertainty around when the UK will leave the EU, and the terms under which it may happen, is causing property market uncertainty.

On Tuesday, Theresa May said that it might no longer be possible for the UK to exit the EU on 29 March 2019 as originally planned, although this still remains her preference. The prime minister has promised to put her withdrawal agreement to MPs for a ‘meaningful vote’ by 12 March. If, as many predict, the deal is rejected again, Mrs May has offered two further votes: one allowing MPs to rule out leaving the EU without a deal, and another allowing her to push back the Brexit date.

The announcement followed Labour leader Jeremy Corbyn’s declaration on Monday that he would back a second EU referendum if Labour’s own proposed Brexit deal wasn’t adopted. Many are now predicting that Brexit will be delayed until the end of June at the earliest.

What might a no-deal Brexit mean for house prices?

Many business leaders and financial experts have expressed concerns about the potential consequences of a no-deal Brexit. In September 2018, Bank of England governor Mark Carney warned that leaving the EU without a deal could send house prices tumbling by a third, and this week he added that UK growth would be ‘guaranteed’ to fall in the event of a no-deal Brexit.

So, what does all of this mean for the property market, and what impact has the vote to leave the EU already made on house prices and sales volumes? New analysis of the property market activity before and since the Brexit referendum indicates what experts from the estate agency, building, mortgage and buy-to-let sectors think will happen over the coming months.

What’s happened to house prices since the Brexit vote?

House prices did stagnate for a while following the referendum in June 2016. This could well have been down to the usual pattern of prices growing in spring and plateauing over summer, which was also apparent the same month in 2017. But, with Brexit looming ever closer, house prices suffered a bigger post-summer dip than usual in 2018, dropping from a peak of £232,797 in August to £230,630 in November.

The latest ONS House Price Index shows that they crept up slightly in December, meaning that the current average UK house price is £230,776.

Are UK house prices falling?

Looking at year-on-year house price change over the longer term can be another useful way of understanding what the market’s doing. Transaction volumes since the referendum is another way of judging the health of the housing market by looking at transaction volumes, meaning the number of property sales in any given month. A lower number of sales can indicate market uncertainty, which is often triggered by events such as an election or a referendum. According to HMRC’s most recent seasonally adjusted figures, there were actually more house sales in January 2019 – 101,170 to be exact – than in the same month the year before (99,830).

What’s the pre-Brexit market like for sellers?

Two commonly used measures of how the market is performing for sellers are stock per branch – which is the average amount of properties on each estate agency’s books – and time to sell. In January, the average time for a property to go under offer shot up to 77 days, the highest it’s been in years – and this could be partly due to nervousness around buying a home in the run-up to Brexit. Stock per branch was also up year-on-year, from 42 in January 2018 to 45 in January 2019.

As it stands, the only thing that’s clear is that nothing is clear, and you’d be justified in having no idea whether now is the right time to buy, move, invest or remortgage.

Source and information provided by Which.co.uk

Read more: https://www.which.co.uk/news/2019/02/what-will-brexit-mean-for-house-prices/ – Which?

Why your development should have a Resident’s Association

A Residents’ Association (RA) is a local group, made up of local residents who represent the interests of everyone living in a particular area or building, they are set up for everyone to join and membership is open to all local residents (tenants and leaseholders). For the RA to be successful and effective it should represent and include all residents in the area its serves.

Why are they worth having?

A collective voice is a powerful voice. Being united with other people who share your living environment, means that you have the opportunity to influence and shape the quality of the services to your local community and improve residents’ quality of life.

For example, you can…

  • have a say on the services provided by Network Homes – i.e. cleaning and repairs.
  • develop the environment and community i.e. apply for funding for safe play areas and carry out social activities that bring you and your neighbours together.
  • lobby the council for local provision i.e. recycling facilities, improved lighting etc.

The formation of a residents’ association is a simple process, which requires a group of interested individuals with a common interest and an agreed constitution, by which the activities and rules of the association are governed. The recognition of residents’ associations is in Schedule 19 of the Housing Act 1980, as amended by the Landlord and Tenant Act 1985 and 1987. This act of law entitles RA’s to certain rights and access to information which is not typically shared, such as work invoices, detailed transaction reports, stock condition surveys and fire risk assessments (FRA). This transparent and open approach with a small group of elected members is often valued by the wider majority; seen as an honest attempt for transparency, improved communication and better relations.

When carrying our planned work or major repairs, RA’s are a great sounding board for ideas and feedback. They are often happy to ballot members for when multiple options are on the table, or similarly, they will make the final decision on behalf of their members, as elected to do so. This approach put people and the centre of what we do.

For Managing Agents and Landlords, there is little administration required when working with an RA. It is easier and far more effective for RA’s to meet frequently with the Inspired Property Management team to ensure your goals are recognised for the development and your ideas are heard. If you’d like to know more about how our team at inspired can work with your RA please get in touch with a member of our team.

Decorate your apartment without upsetting your landlord

A few nifty tricks to give your home a very merry makeover without so much as a pin in the wall… Handy if your landlord has stipulated no holes in the walls.

Hosting Christmas for all the family in your new rental home? We have all the tricks of the trade to make your house feel Christmassy, festive and merry without pinning or painting anything.

Keep your landlord, and even your mother-in-law, on side with these nifty decorating techniques that won’t damage a wall, skirting board or doorframe…

If you can’t hang things on the walls or pin anything to doorways, then opt for ornaments. Glittery reindeers, giant nutcrackers and charming nativity scenes will create a traditional Christmas feel without upsetting the landlord. Smother mantelpieces, top tables and decorate the base of your tree.

Redecorate with a wreath

If you can’t go crazy inside, then you always have outside. People are putting exterior lights up, perching trees on their porches and of course the time old tradition – hanging beautiful wreaths. If you don’t want to pin it to your door, cascade the circular garland from ribbon tied to a door handle or brickwork above the frame.

Go crazy for candle displays

Candles omit a Christmassy glow, warming winter scents and can be glammed up to create opulent table displays. Surround simple tower candles with conifer cones, berries and rings of holly to give off an easy Christmassy vibe without redecorating a thing!

Go gaga for garlands

Bring the forest inside this winter by draping garlands of holly, ivy and fir across fireplaces, mirrors and winding them up staircases. Botanical displays around the home will instantly give off the smell and look of Christmas without damaging anything.

Invest in warm wintery accessories

With just a few hours of light a day (and even those are clouded, snowy and drizzly!) we all love wrapping up in a cosy onesie and nestling into our cushioned den with a chunky throw. Accessorise this winter with Christmas-inspired and adorned cushions and blankets that will transform that bleak sofa into a sanctuary.

Decorate a traditional tree

If you’re unsure about pinning things on walls then simply go to town on your Christmas tree. Get the biggest one you can, or a collection of tiny trees, and adorn it with a sprinkling of hundreds and thousands, a scattering of fairy lights and top with a beautiful angel.

Top it off with an amazing table display

We all spend a large amount of the big day in the dining room eating and drinking and eating some more, so decorate your table extravagantly. Invest in a large centrepiece and compliment it with fanciful dinner platters, serving spoons and festive flowers for a truly beautiful banquet.

How will you be decorating your apartment home this Christmas?

Tips courtesy of idealhome.co.uk – read more here

Merry Christmas & Happy New Year

The team at Inspired Property Management would like to wish all our tenants and clients a very Merry Christmas and a Happy New Year.

We look forward to seeing you all in 2019.

Our offices will be closed from the 17.00pm on Friday the 21st December and will reopen again on at 9.00am on Wednesday the 2nd January.

For any emergencies out of our normal working hours, including flood issues please contact the emergency number below.

Urgent maintenance or emergencies: 01302 249 349

To view our latest news please visit our website

The impact of advances in AI on your home

Over the next five years, we are about to witness the world we live in entirely disrupted by improvements in artificial intelligence (AI) and machine learning.

Children today are growing up with AI assistants in their homes (Google Assistant, Siri and Alexa and the newly launched Vector Anki aimed at children) — to the point that you might consider their mere presence an extension of home organisation and home assistance. As voice and facial recognition continue to evolve, machine learning algorithms are getting smarter. More and more industries are being influenced by AI, and our society as we know it is transforming.

We all have various technology we use in our everyday lives like our smartphones, laptops, tablets and fit bit devices but with the ever evolving changes in technology, are we getting nearer to a home run by A1?

New technology is now available like the smart thermostat or smart lighting which can save you money, but what’s infinitely more exciting to people is the smart home could offload any decisions/choices and work by completing tasks independently.

A Smart Home Driven By Artificial Intelligence

In many industries, when you interview an ambitious leader, he or she will talk with you about how they will reinvent factory-built housing or the fitness space or retail. However, in some, people will talk about how they are part of an ecosystem and how their success is in large part predicated on the success of other companies in the ecosystem. In the case of the smart home, almost all of the players I interviewed talked about a future where the holy grail was a home driven by Artificial Intelligence.

Think of Artificial Intelligence as computing power that is able to perform particularly complex tasks that would otherwise require a human brain to perform. A motion sensor might trigger a light to turn on. But if a home had Artificial Intelligence, it might consider the time of day, the person walking around the home, and where she was walking in deciding which light to turn on and how long to keep it on for. Not every person I spoke to used the words “Artificial Intelligence.” A hot phrase you’ll hear again and again from experts is that a house needs to be “aware” or “contextually aware” before you can bring Artificial Intelligence into the home.

Let’s imagine the universe of things a house can be aware of: it can be aware of the presence of the people who live in the house (along with their personas); it can be aware of what they’re doing; it can even be aware of what every device in the house is doing. If you want the house to think like a human, the house needs to be able to analyse the data a human would analyse before making a decision.

Whether you are pro A1 or not this is definitely something which is shaping our homes in the future.

Changes to the rules concerning assured shorthold tenancies for Landlords

Changes to the rules concerning Assured Shorthold Tenancies come into place on 1 October this year.

How will this affect you as a landlord?

The Act brought into force new rules in which Assured Shorthold Tenancies (ASTs) in England could be granted and terminated, which can restrict the Landlord’s ability to serve a notice under Section 21 of the Housing Act 1988 to terminate the AST.

Between 1 October 2015 and 1 October 2018 these requirements only applied to an AST created on or after 1 October 2015. However, from 1 October 2018 the requirements will apply to all ASTs irrespective of when the AST was granted.

Q. What is the effect of the act?

A. A landlord will only be able to serve a Section 21 Notice once he has first complied with the regulatory requirements under the Act. These are that the landlord must have provided the tenant with the following:
An Energy Performance Certificate (EPC) free of charge.
A Gas Certificate.
The current version of the ‘How to Rent: The Checklist for Renting in England’ booklet.

Q. What if the tenancy was granted prior to 1st October 2015?

A. There is no longer the option of serving the non-prescribed form of Section 21 Notice which does not require compliance with the Act. Only the prescribed form of Section 21 Notice can be used from 1 October 2018.

Q. Can the landlord comply with the requirements after the tenancy has been granted?

A. This is a topic of much debate. In a recent County Court case which is non-binding which was heard in February this year, it was held that the Gas Safety Certificate must be provided to the tenant at the start of the tenancy and that a Landlord is unlikely to be able to serve a Section 21 Notice where it is served late.
The view is that it cannot have been Parliament’s intention to give a tenant full security of tenure and the Landlord cannot be forever precluded from serving a Section 21 Notice. Binding authority is required to give clarity.

Q. Does the landlord have to use the prescribed form of Section 21 Notice?

A. Yes, from 1 October 2018 the prescribed form of Section 21 Notice must be used for all ASTs.

Q. Can possession proceedings be issued after 1 October 2018 relying on a Section 21 Notice served before 1 October 2018 which was not in the prescribed form?

A Yes, the Act should not affect the ability to issue proceedings after 1 October 2018 but relying on a Section 21 Notice which was correctly served prior to that date.

Q. Will the Court grant possession where there has not been compliance with the statutory requirements for an AST granted before 1 October 2015?

A. It remains to be seen whether the Courts will grant possession where a prescribed form Section 21 Notice has been served on or after 1 October 2018 but the Act’s requirements had not been complied with prior to 1 October 2018. It cannot be the case that the landlord will forever be prevented from obtaining possession although Courts may not be sympathetic when faced with a landlord who has failed to take action during the three year transitional period.

Q. Will it affect the accelerated possession procedure?

A. The current Claim Form for Accelerated Possession requires compliance with the Act’s requirements. There are therefore difficulties with using the current claim form and relying on the accelerated possession procedure when the Act has not been complied with for pre 2015 tenancies.

From 1 October 2018, a landlord may only be able to proceed by means of the ordinary possession procedure route.

Holiday Checklist before leaving your apartment

We’re always a little nervous after we leave our apartment for a long holiday. Are we going to come home to a stinky house because we forgot to take out the trash? Will I have a leak? Let us help to allay them with this handy checklist of things to do before you leave your apartment.

Compiled from our own experience of queries we have received from tenants and our excellent customer service team. This list can help you remember everything that is easy to forget in the excitement of preparing for a trip of any length of time. Follow this list and we promise you won’t come home to a stinky house (and hopefully you won’t have a swimming pool newly installed in your bedroom, too).

Temporarily stop mail and newspaper delivery

 or arrange for a neighbour to take care of it.

Prepay bills

that will come due while you are away or any service charges for your apartment.

Finish up perishable food in your refrigerator

or donate to neighbours.

Take out the trash and recycling

no one likes returning to a smelly house.

Do the dishes

you’ll be so glad on your return

Run your garbage disposal

to stop any nasty smells on your return

Coming home food

leave a meal waiting in the freezer

Unplug appliances like

coffee machine, computer, TV and other appliances and electronics. Make sure any electronics left plugged in have surge protection

Time your lights

or consider doing this to keep burglars at bay.

Turn down the AC and heat

 unless of course a pet sitter and pets will be there and think of the season you are too.

Put on clean sheets

 it’s always nice to come home to a clean bed.

Water plants

or arrange for a neighbour to water them

Close and lock windows

to make sure your apartment is secure

If you’ve got a spare key hidden

 somewhere outside your house, you may want to remove it, unless of course, you’ve forgotten to take your key on vacation with you.

Sprinkle a little baking soda

 in toilets and down the sink drains to avoid coming home to the stench of stagnant water.

Make sure you have not left any wet clothes

 in your washing machine or drier. Consider turning off all the water, but at least turn off the water supply to your to washing machines, dishwashers, ice-makers and toilets.

Now turn on your email out of office.

 Do this even if you are planning on checking email. It will relieve you of the pressure to answer quickly and reduce the number of emails you get.

Got any great tips that we have missed, then why not email one o our team.

Happy Holidays…