The Follow up - Property Owners' Pockets Hit As Service Charges Soar

Following our recent article flagging up escalating service charges, we received a great deal of response from disgruntled property owners. It clearly touched a nerve!

On the surface of it, the management of blocks of flats is a simple matter, but leasehold residential property management is actually very complex. Due to the number of properties that are bought to let, a thorough knowledge of landlord and tenant legislation is required, as well as an understanding of the structure and meaning of leases. An adherence to Health & Safety criteria and compliance with recognised Codes of Practice is also needed, and then there's the proactive day to day maintenance work that should be undertaken to keep the development in good working order. All in all, it's a lot of different areas that need simultaneous attention.

So whilst you may wish to jump ship from your current Managing Agent, take care. You need to approach a well-established ARMA member, which means they accept and undertake to comply with the RICS' Code of Practice - "The Service Charge Residential Management Code". Ideally they'll be locally based in South Wales and dedicated to this remit alone. We know of only one such firm that meets these specifics; Western Permanent Property.

In effect, managing a block of flats or a housing development is like managing a business. It requires specific skills and time...and lots of it, we're told!

We mentioned in our original article that some leaseholders have exercised their Right to Manage (RTM) to facilitate such a change in management. In short, this procedure results in leaseholders taking control of their block, yet, managing the same within the covenants of the lease. The end result is twofold - there are savings to be made and those paying the service charges develop a greater understanding of what is necessary to deliver the required service.

Western Permanent Property has considerable experience in this field, having operated in this specific sector since the mid-1970s. Should you or somebody you know be interested in undertaking the Right to Manage, we suggest that you contact Neil Gregory (neil@wppmc.com) in order to discuss the position in much further detail.

Some developments already have an autonomous Residential Management Company (RMC) in place. If this is the position in your block, the process of altering agents is much easier as leaseholders are also shareholders of the RMC with voting rights.

Leaseholders are entitled to a communicative, cost effective and transparent Managing Agent that follows instructions, as opposed to one that works for the Ground Landlord. If you're not currently receiving this service, it may well be an idea to look into the RTM process.

27 February 2013

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