Do you get that sinking feeling with your sinking fund?

You may have seen a line in your development’s annual budget for contributions to the sinking fund – but what is this and why does it matter?

A sinking fund is money earmarked for large-scale or substantial building projects that are carried out to keep your development looking good and working correctly. We refer to these projects as ‘major works’ and these can include things like redecorating the outside of your building, repairing the roof or replacing communal windows.

How is the amount calculated?

When calculating the amount to be taken, the property management company should take into account the potential replacement costs of certain items and the average length of time that passes before each type of repair.

By way of an example, a management company should consider the cost of replacing a door entry system of a property as well as the average amount of time before such a repair is usually required. This should then be calculated into a yearly figure and this figure will form part of the total yearly charge that each resident has to pay towards the sinking fund. Other examples of typical repairs and replacements that are taken into account and for which sinking funds are used include drainage, communal lighting, footpaths and certain access roads. Certain repairs which are considered minor are paid for by the service charge. Obviously such calculations can never be precise, but if all the different scenarios are considered properly, a sinking fund can mitigate the risk of incurring large costs on a property.

Benefits of a sinking fund

The main advantage of a sinking fund being collected as part of a service charge is that the expenses for repairs are pre-planned rather than a call for a large amount in one go which may come as a shock to leaseholders, some of whom may not have the funds to pay.

As well as the above, leasehold properties may be easier to sell if there is a sinking fund, which may avoid a buyer being overly concerned about major works expenses.

If you’d like to know more about your sinking fund, get in touch we the property managers at your development or apartment block.

Season’s greetings from IPM

The team at Inspired Property Management would like to wish all of our clients and customers a very

Merry Christmas and a Happy New Year.

We would like to remind all clients and customers that our offices will be closed from the 23rd December 2019 and they will be opening again on the 2nd January 2020.

For any urgent enquiries or our out of hours service, please contact 01302 249349 or 0203 006 8320. This service is available week days between 17.00 and 09.00 and from 17.00 on a Friday evening through to 9.00 on a Monday morning.

If a problem is reported by email the team will review the email within working hours on their return.

Happy Christmas!

The future of EV and apartment blocks

Electric vehicles are growing in popularity but blocks of flats may not be able to handle a smooth transition due to lack of allocated spaces.

Climate change and tackling air pollution are two issues that have been pushed to the top of the political agenda in recent months, with the government calling on the commercial sector to develop eco-friendly solutions that we can adopt without too much disruption to our daily lives. One change that has been noticeable on UK roads in recent years is the increase in hybrid and electric vehicles.

The government announced in 2017 that the sale of new diesel and petrol cars and vans will be banned in the UK from 2040, although there is now a steady push for this deadline to be earlier. Sweden has just announced that the sale of electric cars outsold combustion vehicles for the first time in April this year. But, at present, the market for electric cars in the UK is still relatively small, with around 155,000 of these vehicles sold in the UK in 2018, and around 4,500 more being registered every month. By comparison, there are around 30 million fuel-powered cars (source: Wired UK) in the country. However, during the next 20 years we will all be switching to electric vehicles (EVs) and where there are EVs, there must be charging facilities.

Charging points have already sprung up at motorway services, at railway stations, at supermarkets and in car parks but increasingly vehicle owners want the convenience of charging their car at home. Studies show that 75% of electric vehicle charging will be done at home. The convenience of getting into a fully charged car (rather than standing at a petrol pump) in the morning is a huge appeal to prospective buyers.

This is no problem if you live in a freehold property but leasehold flats throw up more challenges. Developers are now installing electric charging points in new blocks as standard but for anyone with responsibility for an existing development that wants to install charging points, there are a number of issues for property managers to consider.

Start with the lease

As ever, the starting point is always the lease. In the majority of cases, residents will need a license to alter from the landlord to install one or more charging points. This formal, written consent will normally cost around £650, which will need to be covered by the resident/s in question – assuming the freeholder is happy to oblige.

The supply

Once consent is obtained, there are also issues around location of charging points and electricity supply to be considered. Some flat owners may have an allocated parking space or garage demised to them but the electricity supply to that parking space – if there is one – won’t be connected to the electricity meter in their flat. As most leases provide for a right of use of parking spaces without ownership, car parks are normally connected to the communal supply that is covered by the service charge. When only a handful of residents are gaining the benefit from the electricity that is being used by EV owners, this is unlikely to be warmly welcomed by the majority and may not be possible under the terms of the lease.

The good news is that EV charging technology is rapidly evolving to keep pace with demand and there are now options on the market that can get around many of the problems that residential blocks throw up.

Pay-as-you-go solutions working in tandem with cloud-based mobile apps – similar to those now being installed in public spaces and by employers – mean that electricity used by individual residents can be monitored, logged and paid for. Flat owners can use such systems to pay their costs back to their block on a monthly basis, so that residents who don’t use charging points are not subsidising those that do.

Installation

Set-up is simple, with very little electrical work needed to install a simple pay-as-you-go charging system. Your existing landlord/communal area supply service distribution equipment will hopefully be extended and a dedicated distribution board installed to feed the new charging points. Sizing will depend on how many charge-points you require now or wish to allow for future expansion. It should be possible for all wiring to charge point locations to be run using the building’s existing wiring containment system where feasible, ensuring the installation is as discrete as possible. If not, then galvanised cable tray may be needed to disguise any additional wiring.

Cost

Of course the other big question that residents will be asking property managers to answer is how much will the installation cost and who pays? And costs to residents may be partly covered by a government-subsidised grant from the Office for Low Emission Vehicles (OLEV). The OLEV Grant is also known as the Electric Vehicle Homecharge Scheme (EVHS) and provides £500 off the cost of purchasing & installing a home charging point. However, as with all government grants, this one won’t be around forever, so if you are considering EV charging points, now is a good time to think about installing them, while financial assistance is still available.

One exciting aspect of EV charging technology is that in future, once charged, EVs will be used as mobile batteries that, rather than just taking an electrical charge from a residential supply, will also be able to put electricity back into the system, making charging points carbon neutral – or even carbon positive. New storage batteries currently in development are expected to unlock a range of in-home energy production methods. These batteries will be able to store power at a local level and further down the line, may even distribute power across a community.

Conclusion

Now is the time for property managers and landlords to start thinking about providing charging facilities and to have the conversation with residents – whether or not anyone in your block/s owns an EV. In future they will and it is well worth being prepared to deal with the questions that will be asked by residents about installing them – in 10 years’ time they will be standard too.

Best practice advice for fire safety in flats

ARMA (the Association of Residential Managing Agents) has issued a ‘Fire Safety Management in Flats’ Guidance Note to share best practice with professional Fire Safety personnel involved in the residential leasehold sector, including managing agents, developers and landlords.

The Guidance Note has been produced in line with statutory guidance and industry best practice and independently reviewed by Hampshire Fire and Rescue Service, ARMA’s Primary Authority Partner and can be accessed by clicking here.

Dr Nigel Glen, CEO of ARMA, said: “ARMA members have access to over 100 Guidance Notes on a wide range of topics affecting leasehold properties. This is the only one that has been made available to non-ARMA members, as we wish to promote Fire Safety industry-wide.
Information courtesy of News on the Block.

Top 10 tips for fire safety in flats:

  1. Ask your managing agent to provide you with a copy of the building’s latest fire risk assessment. It is, effectively, a guide book for fire safety plans in your building.
  2. If your managing agent won’t provide you with a copy of the fire risk assessment then complain to the individual agent directly. If that does not work, then make a formal complaint through the internal complaints procedure at the agent’s company.
    If you are still unhappy, you can complain to a redress scheme. All managing agents in England must be a member of one these redress schemes:
    o The Property Ombudsman
    o The Property Redress Scheme
  3. If there is no fire risk assessment and the responsible person will not conduct an assessment, then contact your local fire and rescue authority (FRA). Your FRA is responsible for enforcing fire safety regulations. They can make the person responsible for fire safety in your building carry out a fire risk assessment.
    Your local fire service can tell you who the FRA is (it might be your local council). You can also search on the National Fire Chiefs Council website.
  4. It is recommended that for low-rise blocks of up to three storeys above ground, built in the last 20 years, fire risk assessments should be:
    o reviewed every 2 years
    o redone every 4 years
    For blocks with higher risks (for example, because of the age of the building), or those more than 3 storeys high, it is recommended that assessments should be:
    o reviewed every year
    o redone every 3 years
    In extreme cases (for the highest-risk buildings), a new fire risk assessment is recommended annually.
    When you receive your building’s fire risk assessment check when it was last redone and/or reviewed.
  5. If you have received the assessment, check that the managing agent has or will act on its recommendations.
  6. Fit smoke alarm(s) in your flat and test them monthly.
  7. Be vigilant that the communal areas are free of obstructions to your escape from fire; and that fire doors in communal areas are not propped open.
  8. If a specific ‘evacuation plan’ is agreed with the Local Fire Authority then you should read the plan carefully, so you know what to do if you ever need to evacuate.
  9. Check that the managing agents have regular testing and servicing arrangements in place for any fire-fighting and detection equipment.
  10. If alterations to doors or the internal layout of the flat are planned, consider implications on fire safety and check any issues with your managing agent.

If you would like to know more about the safety standards undertaken by Inspired Property Management in managing your development please get in touch with a member of our team.

Getting to grips with your apartment bills

Most of us have been affected one way or another by the economic downturn – we are certainly less inclined to use our credit cards than we were a few years ago and we are all looking for ways to cut back on the bills,  especially with the rise in VAT looming. Here are some suggestions from Inspired Property Management that could help RMCs and leaseholders keep their costs down.

Utility bills

When you add up all the bills for electricity, gas, telephone calls and water, they account for a considerable proportion of the monthly outgoings. It is always worth keeping an eye on what you are paying for utilities. Consider changing provider if another company can offer a better deal. You will not notice any difference in your supply but customer service and response times to queries can vary enormously between utility companies. Ask around – can friends or family recommend their supplier in terms of cost and service, speak to your neighbours as collectively if you all switch they may offer you a discount? Changing provider is not a complex process and is quickly completed, but do expect a call to ask you why you are moving to a different company. If you pay your bills by direct debit you will need to contact your bank to cancel your existing arrangement and set up a new one.

Gas and electricity

Consider using the same provider for gas and electricity – a dual fuel discount may be available. Look out for special offers: some companies offer additional incentives such as ‘Nectar’ points to new customers which you can then use to pay for supermarket or high street items.

Some quick wins are:

  • Use low energy light bulbs, switch off lights and don’t leave appliances such as TVs and computers on standby.
  • Invest in an energy monitor or employ an electrician to do an energy survey of your home for you to identify which appliances use the most electricity.
  • When buying new appliances choose those that are A- or B-rated for energy efficiency.
  • If you live in an older block and have open fires, use them, if you have somewhere to store the fuel. A few logs will keep you warm and save you turning up the central heating – but don’t forget to get the chimneys swept if you haven’t lit a fire for a while. Check first that you do not live in an area that restricts the use of solid fuels or a smoke free zone.
  • If your hot water tank isn’t lagged, do it this weekend. It is cheap and easy and will save you money.
  • Invest in fully lined curtains and insulation around doors and windows – this will help keep the heating bills down if you don’t have double-glazing.

Telephone and broadband

Telephone calls are another major overhead for many of us, especially if we have teenagers in the house or work from home. There are lots of deals out there and it is worth going to a cost comparison website such as www.homephonechoices.co.uk to find out if you could be paying less for your phone. Check your contract to make sure you’re not tied into a fixed period with your provider. Switching phone companies is a simple process, which shouldn’t take more than 14 days to complete.

You can even do it online. For those with broadband, it can be more cost effective to bundle the cost of a landline and broadband together by using one provider for both – you could even add mobile calls and satellite TV. Sky and Virgin media both offer TV and telecoms packages. If you do decide to change broadband provider, don’t forget to check the speed of your new provider’s broadband service in your area and ask how long it will take to connect you. This is particularly important if you rely on your internet connection for work. If you don’t want to change provider but are keen to keep phone bills to a minimum, look at the small print on your next bill: making off-peak calls is cheaper. Talk Talk offer evening and weekend packages and BT ’s  ‘Friends and family’ gives you cheaper calls to certain numbers. All providers have their own tariffs so check your telephone company’s website for more information.

You might even consider dropping the landline altogether if you can get a good mobile signal at home – there is no line rental on a mobile, contracts are very competitive and you will be offered a new handset free of charge on a regular basis. If you live in a mobile signal blackspot – there are products on the market such as Vodafone’s Sure Signal, that claim to give you a strong mobile phone signal in your home, using your home broadband. It boosts the signal throughout your house for up to four people at the same time. To use, you need a broadband connection with a minimum line speed of 1Mbps, plus a 3G mobile phone.

Water

Although UK water companies have been privatised, the market is not open to competition, so you can’t switch provider in the same way as for other utilities. Nor are bills based on the amount of water you use. Unlike gas and electricity, water bills are still based on the rateable value of your home.

The only way to ensure that you are only paying for the water you use is to opt to fit a water meter. Only 37% of UK homes have a water meter but having one installed could save you money – and help the environment. If you know you’re paying for every unit of water you use, you are unlikely to waste it.

The average water bill in England and Wales is around £360 a year. For those households with meters, the average bill falls to around £300. However the price of water differs from region to region and so before deciding to switch to metered water, it’s worth finding out whether or not this would really save you money. A rough indication is to look at the number of bedrooms in your flat – if you have more bedrooms than people, a meter could save you money.

For a quick way to estimate how much you could save, go to www.uswitch.com or the Consumer Council for Water website at www.ccwater.org.uk. Both sites have tools to help you calculate your possible savings, depending on where in the country you live.

Suppliers Every block of flats uses a range of suppliers – some deal with aspects of the block itself, such as gardeners, window cleaners and lift engineers and some are employed by individual residents, such as plumbers, electricians, and cleaners. RMC directors or property management company that are responsible for employing suppliers on a regular basis, should ensure that they revisit the costs involved in regular repairs and maintenance on a regular basis. By shopping around not only can you find alternative companies or individuals who might be able to do an equally good job at a better price, but if existing suppliers know that you are aware of the market rate for their services, they may be less inclined to put their rates up.

For individual leaseholders, the cost of employing tradesmen to do small household jobs can be prohibitive. RMCs are in a great position to help leaseholders by encouraging them to pool their resources. Why not employ a carpenter or painter and decorator to bundle a number of small (or not so small) jobs for different residents together over a few days or weeks. This could keep costs down for the tradesman because he may be able to buy supplies in bulk and has less travelling time to and from jobs and as a result may be willing to give a better price. Don’t forget that some tradesmen are also willing to give a slightly cheaper price for cash.

However, cheapest isn’t necessarily best and doesn’t always offer value for money – always check tradespeople’s credentials and use those that are members of reputable trade associations or are professionally qualified. Check they have the relevant insurance cover should problems arise. Never employ anyone who turns up on your doorstep touting for business, no matter how convincing they are.

Inspired Property Management are committed to providing the best service for all our RMC’s and leaseholders, which is why we will review all annual repeat costs and make sure we are giving you the best value. If you’d like to find out more about our services and how we can manage your development please get in touch with a member of the team on 01302 729 500.

Why online payments are becoming more popular for tenants

Millennials are dominating the rental market and using their size and influence to dictate digital and social trends. At more than 80 million strong, the generation is changing the multifamily housing industry from the nation’s largest portfolios to medium and small property management companies.

Their desire to live, work and play online has inspired the new market segment “Gen C,” or the “Connected Generation.” This group embraces technology to buy, communicate and connect via digital interactions. Whether paying bills or catching a ride, “Gen C” often pays through digital platforms, usually mobile devices.

The Centre for Generational Kinetics notes that millennials are paying for products and services different than other generations. In 2016, the research group cited that five million millennials didn’t have a checking account, and a more recent study showed the generation carries very little cash. The centre says that businesses that want to attract and retain millennials must make it easy to pay with a credit card or through an on-line portal.

On the heels of the generation is Gen Z, which is multifamily’s next target renter group and one that doesn’t remember a time before the digital world.

Today’s renters expect to use electronic payment technology

The arrival of these generations and their digital briefcases is transforming the way property managers receive rent. Rent payments are going paperless and online, a less risky proposition than manually receiving checks and standing orders or processing credit or debit cards in the leasing office.

In the last 10 years, renters have come to expect to have access to at least one electronic payment technology. It’s becoming the rule rather than the exception.

The National Multifamily Housing Council (NMHC)/Kingsley Renter Preferences Report revealed an entirely new trend, showing that over 76 percent of renters now pay electronically every month. No surprise considering that online access has increased given the multiple devices and channels available for all consumers.

The ‘tipping point’ of payment options for generations

Conversely, downsizing Baby Boomers, who have been a growing contingent in multifamily, have been slow to embrace automated payments. Nearly half of the 65+ age group prefers paying at the front office.

For property managers, companies caught at the cusp of this generation’s “tipping point” must continue to provide as many choices as possible to maximise revenue while still keeping up with technology.

Implementing a configurable and comprehensive online payments solution removes the risk of on-site, paper-based payments and the horror stories that go along with them. In addition, online payments enable properties to track, manage, and report every payment to keep ledgers in order with as few errors as possible.

Enabling residents to pay rent online also ensures the property is getting the rent it deserves with less fear of bouncing, lost or stolen paper payments, a big plus when a property or portfolio is counting on that revenue to grow business.

Inspired Property Management have invested in creating a on-line portal where all tenants can view outstanding invoices and make payments. The on-line portal makes paying and processing payments online simple, seamless and secure.

The BIG Broadband issue

With the advances in technology and many people being reliant on their Broadband for watching television, managing their appliances, monitoring their homes and the ever evolving world of remote working, broadband infrastructure is now in demand more than ever.

Previously many management company knew very little about the broadband infrastructure  available across their developments. Now it’s become one of the biggest issue for tenants, which means it’s now very much hitting the top of property managers agendas.

It’s become a huge part of the decision-making process as much as proximity to good schools and transport links. It forms the foundation of the connected home and when it doesn’t perform well, it impacts on people’s ability to work and enjoyment of technology advances.

Broadband lottery

Resident management companies and property managers need to understand what infrastructure is available, and crucially what the process is to enhance it so they may inform all tenants of how they can improve on their infrastructure. Currently broadband is very much a post-code lottery.  USwitch recently reported that the average speed in the UK was 46.2Mbps, but 13% of homes have speeds below 5Mbps. Also, according to research by Think Broadband, one in eight new properties have speeds so slow they fall below the Government’s minimum requirement of 10Mbps.

Speedy resolve

Here are the different types of broadband infrastructures available:

  • ADSL broadband – Many blocks still only have access to copper based ADSL broadband that cannot deliver over 5Mbps.
  • Fibre-to-the-Cabinet (FTTC) – this is what is most commonly available and sold as ‘fibre’ by many of the big Internet Service Providers. This is somewhat misleading, as FTTC simply means that there is fibre to a junction box on the street, so the connection into the building is still delivered over copper phone lines. As a result, there continue to be huge issues with peak-time slowdowns and distance attenuation, further away the property is from the telephone exchange, or the higher the flat the poorer the service.

  • Fibre-to-the-Building (FTTB) – also known as ‘full fibre.’ the ‘gold standard’ of broadband – its now available across 8% of the UK and the government is commited for everyone to have it by 2033. With full fibre the customer can enjoy symmetrical gigabit broadband services at 1,000Mbps. With these speeds, HD movies can be downloaded in seconds and families can simultaneously access the Internet, without any frustrating slowdowns, buffering or timeouts.

Fibre for all

Once installed, a full-fibre connection can also be leveraged for other purposes which could add value to the development for residents – such as offering communal Wi-Fi hotspots. In addition, in the future this type of broadband will almost certainly be used for IPCCTV (Internet-enabled CCTV) for security systems and monitoring. Also, if every unit in the development is connected at once, which can easily be done in a new development, it means that residents can be online within minutes of moving in – removing wait times for installation and maximising rental returns.

Connectivity is now an essential utility for all tenants. Flat owners and renters expect it as standard. Property managers that provide a future-proofed reliable connection are therefore a step closer to minimising rental voids and, crucially, keeping tenants satisfied. If you’d like us to discuss managing your block of flat, please contact a member of the team today.

I still don’t understand my service charge?

At Inspired Property Management we like to help our clients and customers and ensure they fully understand what a service charge is and why they have to pay it.

Most new apartment tenants have no idea what a service charge is or why it’s required. IPM will guide you through understanding your service charge and the reason it is required.

What is a service charge?

Service charges are payments made by residents for services that are provided by the landlord or managing agent in respect of common parts of buildings and external communal areas of the estate. For example; if you live in a flat, you are required to pay services for internal communal areas in the building that your flat is situated as well as external communal areas. Examples of these charges could be internal cleaning, painting and gardening. Examples of further services you may be charged for are: sweeping of footpaths, litter picking and gardening to communal areas. In short, service charges are costs that are incurred by landlords for the upkeep of communal areas which are then charged to residents under the terms of their lease or transfer agreements. Your lease will detail more information on your services charge and may specify your individual percentage share of estate/block costs.

How do service charges work?

Estimates At the beginning of your service charge year (which is detailed in your lease) we will send you a service charge estimate. This letter estimates the amount we expect to spend on your block/estate during the next year. IPM calculate the estimates based on known servicing costs, contracts and prior year actual costs. You then pay for the full service charge year based on the amount listed within the estimate. Service Charges are variable, meaning that they will change each year depending on the amount spent on your block or estate. Your estimate may increase some years and decrease in others.

Final Accounts

Once the financial year ends, IPM have 6 months to review all expenditure carried out to each block and estate for the past 12 months. Once we have reviewed all of the expenditure, we post out an end of year statement to each resident which details the actual costs incurred. The estimated service charge amount is also shown on this statement as a credit; the charges are shown as a debit amount. The end of year statement then shows whether overall your service charge for that year is in credit or in deficit.

Please note – your estimated service charge amount on your final account statement will be less any ground rent or sinking fund payments. This means you only pay for the services that have been provided. IPM do not make a profit from service charges as we are only allowed to pass on costs that we have incurred. You can check your actual account against your estimate to see the exact differences between estimated costs for each element and the actual costs for each element. If we are unable to finalise the review of expenditure to your block or estate within 6 months we will send you a Section 20B Notice. This is a formal notice required under service charge legislation which sets out the amount we estimate your service charge might be.

Credit

If your end of year statement of account is in credit this means that the amount you have paid towards your service charges for the year is more than the actual amount spent and money is due back to you.

Debit

If your account is in debit this means that the amount that you have paid towards your service charges for the year is less than the actual amount spent. You are liable for the additional costs under the terms of your lease.

Other Charges

In addition to your service charges depending on your lease you may have to pay the following additional charges. Rent is payable if you are a shared owner and have not purchased the full 100% of your property. In this situation, under the terms of your lease you will be required to pay rent on the remaining share of your property. More details on your rent and how this is increased each year is detailed within you lease.

Ground Rent

Some leases allow IPM to collect a ground rent for leaseholder and shared owners. Please refer to your lease for more information on the amount of ground rent and information on when/how this increases.

Sinking Fund

Some leases allow IPM to collect a sinking fund from leaseholders and shared owners. Sinking fund monies are held separately from service charges in a bank account. They are collected each year and usually spent on major works for the block / estate; for example: A lift replacement, a new roof for the block or re laying tarmac on a road within the estate. Please refer to your lease for more information on the sinking fund.

Help and Support

If you still have queries surrounding your end of year service charge account then please contact our customer service centre on 01302 729500. They will be able to direct you to the correct team who can assist you with your query.

Outside of IPM there are also other organisations that may be able to assist you with your queries.  The Leasehold Advisory Service can provide free information, initial advice and guidance to members of the public about residential leasehold law.

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.