We own the Freehold to our Block. What can we do to Lower the Service Charge for our Flats?


05/06/2024

Author : Mary-Anne Bowring


Lowering the Service Charge in your flat involves careful management and strategic planning. Here are several steps you can take to achieve this:

1. Review the Current Service Charge Levels

- Go through your existing Service Charge Statements: Examine the breakdown of the service charge to understand where the money is being spent.

- Identify High-Cost Areas: Identify specific items or services that are costing the most and assess their necessity and value.

2. Challenge Unreasonable Charges

- Question Overpriced Items: If any charges seem unusually high then speak to the supplier involved and ask them why.

- Seek Expert Advice: Consider consulting a surveyor or solicitor specialising in leasehold law to review the service charges, identifying any unjustifiable costs.

Further Steps

3. Competitive Tendering

- Obtain Multiple Quotes: You should obtain quotes for regular maintenance and services such as cleaning, gardening and repairs. It is sensible to go to multiple contractors to ensure competitive pricing.

- Negotiate Contracts: Sit down with your service providers and look to negotiate the best rates without compromising on quality.

4. Efficient Maintenance

- Preventive Maintenance: Implement a preventive maintenance schedule to avoid costly emergency repairs. The upfront costs should always be lower than those you are trying to prevent!

- Energy Efficiency Improvements: Wherever possible look to invest in energy-efficient lighting, heating systems and insulation. This will reduce utility costs in common areas.

More Ideas

5. Active Participation in Management

- As Freeholders: Form a committee amongst yourselves in order to actively manage your property

6. Bulk Purchasing

- Group Discounts: Wherever possible, arrange for the bulk purchasing of services and supplies to take advantage of group discounts.

And More...

7. Audit and Transparency

- Regular Audits: Conduct frequent audits of the service charge accounts to ensure that you are obtaining value for money and that everything is above board.

- Transparent Accounting: Ensure that all financial transactions are open, easily identifiable and can be justified.

8. Legal and Regulatory Compliance

- Lease Compliance: Ensure that all of the charges are compliant with the terms of your lease and may be legally claimed. Some costs may not be recoverable if they are not specifically allowed by the lease.

- Consultation Requirements: Make sure that everything you do complies with statutory consultation requirements for major works and long-term agreements. This can help in keeping costs down.

The Last Two

9. Energy and Utility Management

- Smart Metering: If possible, install smart meters to monitor and manage energy usage in common areas more effectively.

- Utility Supplier Switching: Regularly review and switch utility companies to obtain better rates.

10. Employ Managing Agents or, better still, www.servicechargesorted.co.uk

- Efficiencies: Good agents will take all of the responsibilities and headaches away from you as residents.

- Compliance: It is eminently sensible to make your agent responsible for all legal and statutory compliances, as well as adhering to the lease terms.

- Save Embarrassment: No need to change neighbours etc for service charge arrears or to ensure that they are complying with their lease. Third party management takes that difficulty away.

To Conclude

By taking these steps, you can work towards lowering the service charge for your flat while ensuring that the property remains well-maintained and services are delivered effectively.

www.servicechargesorted.co.uk can do so for a low fixed annual cost. Please go to our website for further information.

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