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Service charge explained
We believe you should enjoy your home, safe in the knowledge the money you spend on maintenance and the upkeep of your property is being well spent. So here’s a handy guide to weighing up your fees. Service charges and management fees fund the costs of maintaining the development in good order and to a standard you expect.
Here are the answers to common questions you may have on your Service charge:
What is the Service charge?
Your Service charge is the money you pay towards the day-to-day running costs of your development. Every resident pays a service charge and the money is used to cover items such as buildings insurance, maintenance, repairs, gardening and communal facilities.
The Service charge would also cover the costs of any onsite staff. In independent retirement living developments this would normally be your Development Manager. In general residential developments these could be caretakers or concierges; for large, complex estates this could include a Development Manager and a team of concierges, cleaners and handypersons.
When is the Service charge paid?
This depends on your lease or transfer in England or Wales, or your Deed of Conditions in Scotland.
You may be required to pay your Service charge once a year, twice a year (usually every six months) or occasionally in monthly instalments. If you aren’t sure when you should pay your Service charge:
-If you live in an independent retirement living development please get in touch with your Development Manager for details
-If you live or own a property in a general residential development, please get in touch with your Customer Services team
What is the Service charge based on?
The Service charge is based on an estimate or budget we prepare each year of all the running costs relating to the communal areas of your development. These could include a number of elements. Some of the most common are:
-Landscape maintenance – such as cutting the grass, maintaining communal gardens, watering and sweeping
-Lighting, heating and cleaning of communal internal areas
-Window cleaning – specific to each development, but would typically include all external windows as well as internal windows in communal areas
-Fire equipment maintenance
-Other electrical and mechanical equipment maintenance – specific to each development, but this could include items such as water pumps, electrically powered entry or security gates, communal heating boilers etc
-General repairs and maintenance
-Salaries of any onsite staff that are employed specifically to work for the development
-Buildings insurance – in the case of apartments, full buildings insurance is required under the terms of the lease to cover the risks relevant to the development. Standard insurance risks might include fire, explosion, lightning, aircraft, terrorism, storm or flood, sprinkler leakage, subsidence or landside etc
-Bank Charges and Audit fees