Your lease (for leaseholders) or your deeds (for freeholders) will describe any charges you have to pay on the property. These charges can include rent, service charges (including repairs and insurance), a contribution towards the Sinking Fund (or Reserve), and management fees. There are some additional administration costs you might be expected to pay, but these are individual charges for specific items.
Every year we will send you an Annual Budget in February that will detail the charges for the forthcoming period 1st April to 31st March. Your lease will describe when to pay these charges.
Leaseholders and Freeholders may have a small ground rent to pay, although most have nothing. Please check your lease to see if you should be paying ground rent. Any ground rent that you are expected to pay is set out in the Annual Budget.
If you are a Shared Owner you will pay us rent on the remaining share of the property that we own.
If you pay rent, it will be reviewed every year in line with the terms of your lease. You will be notified in writing and provided with 30 days’ notice of any new rent charges.
Service Charges are the charges that leaseholders pay to cover the actual costs to run the building or estate. These services are defined under the 1985 Landlord and Tenant Act as: “services, repairs, maintenance, improvements or insurance or the landlord’s costs of management”.
These services are defined in your lease that we supply or contracted out. Services can include:
How service charges are calculated
We calculate the cost of services for each building or estate before 1st April every year. This is calculated by looking at previous service charge costs and anticipating any changes to costs for the next year. For example, if we know that the insurance will go down or the electricity will go up, the Annual Budget will reflect that.
The charges are calculated by anticipating the full cost of all the services which are then divided by the number of leaseholders who receive the services. These anticipated service charge costs are sent to all leaseholders in the Annual Budget.
At the end of every financial year we work out the total income we have received from service charges and subtract the actual costs that we incurred for the services. If we have collected too much, we will reimburse the accounts. If the shortfall causes your account to to go into arrears we will ask you to pay this.
Each scheme has its own service charge, there is no cross subsidisation from one building or estate to another.
If you are a leaseholder you will pay for any repairs or planned maintenance on your property. If this is a normal day to day repair, then the cost is charged back to you through the service charges. If there is any major work planned, like a new roof, then this will either come from your sinking fund or you may be invoiced directly.
In the Annual Budget we try to anticipate the number of repairs that are going to be reported for the next year to help us work out what you will need to pay. At the end of every financial year we work out the total income we have received from service charges and subtract the actual costs that we incurred for the services. If we have collected to much collected, we will reimburse individuals’ accounts. If there is a shortfall or deficit we will invoice individual accounts.
If you are a leaseholder, we are responsible for insuring your building. We look to insure buildings at a competitive price and the cost of this is included as a service charge and itemised in the Annual Budget. We will regularly review the quality of the insurance cover and cost to ensure it provides value for money. We will consult with you on any changes we propose regarding the insurance provider.
Most freeholders are responsible for insuring the buildings they own, but some freeholders also have a building insurance charge where we are required to insure the building. Please check your Deeds for further information.
Your Annual Budget will identify if we insure your building, but if in doubt, please contact the Sales and Leasehold Team.
The cover
If your building is insured by us, our insurance policy covers the exterior and structure of the building, any communal areas and some internal fixtures. It does not cover the contents of your home, this is something that you need to insure yourself to cover your belongings.
The summary of cover provides a summary of the features, benefits and limitations of the insurance cover.
Sub-letting your home?
Before you sub-let your home, you should have asked us for permission under the terms of your lease. If you have not told us the property is sub-let, or we haven’t given permission, your insurance claim may be affected. We also recommend you contact your insurer about any contents insurance you have taken out at the property.
Changes
Some changes to your circumstances can affect your insurance. If you plan to make any alterations or improvements to the property please contact us. For example sub-letting your home or making any alterations or improvements to the property.
Damage
If you, or anyone living in or visiting your home causes any damage to the communal parts of a building, you are responsible for repairing the damage, or paying us to repair it. This also applies to fixtures and fittings damaged through neglect or carelessness.
If any damage is caused to your home because of an accident in an adjoining property (for example a flood), then you can claim on our property insurance. If you need to do this, please contact the Sales and Leasehold Team who will be able to help you with this. Please don't start any repair work before the insurance have agreed to pay, otherwise you may be liable for the full cost of the repair.
Making a Claim
We hope you never have to make a claim, but if you do we aim to make it as easy as possible. Please contact the Sales and Leasehold Team for details on how to make a claim, you can reach them on 0300 561 1111 or email leaseholders@irwellvalley.co.uk
If you have any queries once you have completed and returned the claim form, please contact the buildings insurer directly. You will need to quote the full policy number in any communications with them.
With most leases, we are responsible for ensuring the building is well maintained. This includes replacing and improving major parts such as a new roof or replacement windows. Whilst it is our responsibility to arrange this work, it is the leaseholders responsibility to pay for it.
The lease usually states that the cost should be paid on demand, but we know that this can cause financial difficulties for residents. So, to offset potentially high costs for planned and major works, some buildings or estates have a sinking fund (also known as a Reserve Fund in some leases). The sinking fund then allows the costs, which should be paid for on demand, as per the lease, to be lessened.
Sinking funds are paid into equally by all leaseholders. It is a separate fund to other service charges and is specifically collected to pay for, or contribute to, major works. We carry out Stock Condition Surveys to assess and monitor the lifespans of each component of the building (roof, windows, lifts etc) and our estimates are detailed in a 30-year plan.The level of contribution into the sinking fund is reviewed each year and is calculated by looking at the 30-year plan for each component and dividing the cost by the expected lifespan.
The level that you will have to contribute into the sinking fund will be itemised in your Annual Budget. There will also be a statement of the sinking fund.
Monies held in the sinking fund are held in ‘trust’ in an interest-bearing account. The interest received is added to the sinking fund and is shown in the audited accounts. Sinking funds are funds for the property and they cannot be withdrawn by the leaseholder.
Where the cost of the works exceeds £250 per person we will always follow the Section 20 consultation process.
Typical planned works which the sinking fund would be used are:
Expenditure on minor repairs to any of the above would normally be met out of the service charge account.
If you are planning to sell your home please check with your solicitor to see if you will have to pay a lump sum into a sinking fund when you assign the lease to the new leaseholder.
Just like service charges, management fees are calculated based on what it costs us to manage the building or estate, this is then shared out equally between the leaseholders.
We try to keep the management fee as low as possible. In fact, the actual cost to us is considerably higher than our current management fees.
Here are just some of the things we do for you that is included in your management fee.
These are sometimes included in the service charges and cover the costs incurred in contracting a specialist when necessary.
In the lease we are usually able to charge these costs back to the leaseholder, shared owner or freeholder. These services are usually for things like an accountant to audit the accounts or a specialist to carry out a Fire Risk Assessment.
These costs are then allocated equally to all the residents in the service charges.
Item / Service |
Administration Fees 2019 |
Sales/Resales - Landlords Enquiries (Flats) |
£175.00 |
Sales/Resales - Landlords Enquiries (Management company) |
£175.00 |
Sales/Resales - Landlords Enquiries (houses with services) |
£150.00 |
Sales/Resales - Landlords Enquiries (houses no services) |
£150.00 |
Hard copy of landlord enquiry pack LPE1 (printed and sent in post) additional fee |
£15.00 |
Valuation - Shared Ownership |
£195.00 |
Assignment - Shared Ownership |
£75.00 |
Re-mortgage Applications / Notice of Charge |
£60.00 |
License to Assign (permission to sell) |
£60.00 |
Notice of transfer |
£60.00 |
Deed of Covenant |
£60.00 |
PDF copy of lease (from Land Registry or scanned) |
£35.00 |
Paper copy of lease (from Land Registry or scanned) |
£50.00 |
PDF copy Insurance policy document |
£0.00 |
Paper copy Insurance policy document |
£35.00 |
Lease extension admin fee |
£250.00 |
Enfranchisement admin fee (Purchasing the Freehold) per unit |
£150.00 |
Consent for improvements / alterations - basic - in advance |
£35.00 |
Consent for improvements / alterations - basic - retrospectively |
£75.00 |
Consent for improvements / alterations - with survey - in advance |
£75.00 |
Consent for improvements / alterations - with survey - retrospectively |
£125.00 |
Deed of postponement |
£35.00 |
Deed of variation/rectification administration fee |
£195.00 |
Removal of 1 party on Shared Ownership |
£250.00 |
Buying more shares/staircasing/memorandum of sale |
£75.00 |
Repaying equity loan (Help to Buy) |
£195.00 |
Repaying My Choice Homebuy loan |
£120.00 |
Equity loan (Help to Buy) transfers (adding/removing names on mortgage) |
£75.00 |
Major works management fee |
10% of the Major works cost |
Consent to sublet in advance (for 1 year) |
£35.00 |
Consent to sublet retrospectively (for 1 year) |
£75.00 |
Certificate of compliance (info to Land Reg) |
£50.00 |
Copy of Service Charge account |
£35.00 |
Copy of audit certificate |
£35.00 |
Copy of Share/Membership certificate |
£35.00 |
Additional copies of correspondence |
£35.00 |
Late Service charge reminder |
£15.00 |
Consent for pets - 1 year in advance |
£35.00 |
Consent for pets - 1 year retrospectively |
£50.00 |
Issue of NOSP |
£95.00 |
Issue of Notice of Forfeiture |
£195.00 |
Landlords Notice for Mortgage Application |
£35.00 |
Landlords Approval for new mortgage |
£35.00 |
Landlords Reference |
£35.00 |
Surrender & Regrant of Lease |
£250.00 |
PDF Copy of Fire Risk Assessment |
£35.00 |
Paper Copy of Fire Risk Assessment |
£50.00 |
Licence to occupy (eg Commercial) |
£195.00 |
Additional Solicitors enquiries |
£35.00 |
EPC/asbestos report/FENSA Fee |
3rd party cost plus £35 |
Retrospective permission to assign |
£250 |
All other retrospective permissions will be the cost above plus £50.00 |
Admin fee plus £50.00 |
Lease extension for Shared Owners |
100% Premium |
Time to carry out work reasonably service chargeable |
£35.00 per hour per person. |
We estimate the cost of services for each building or estate before 1st April every year. This is based on previous costs and anticipating any changes for the next year. So, if we know that the insurance will go down or the sinking fund needs to go up, the Annual Budget will reflect that.
The charges are calculated by anticipating the full cost of all the services which are then divided by the number of leaseholders who receive the services. These anticipated costs are then sent to all leaseholders in the Annual Budget
At the end of every financial year we work out the total income we have received from and subtract the actual costs that we incurred. The accounts are then verified by an independent accountant for buildings where there are more than four leased properties. If we have collected to much collected, we will reimburse individuals’ accounts. If there is a shortfall or deficit we will invoice individual accounts.
Copies of the audited accounts will be sent out with accompanying notes explaining the detail, usually before the end of September.
Each scheme has its own budget, there is no cross subsidisation from one building or estate to another.
We offer a number of ways to pay your rent and service charges click here to find the way that suits you! All payment dates can be found in your lease and on invoices from us.
We know that its not always easy to mange your money, so if you are having difficulties paying your rent or service charges, or wish to discuss your account, please contact us. We are here to help.