Service Charges (Agenda Edition 3) 

Subjects for Tenant Groups to discuss with their landlord

Some tenant groups have asked us for topical agenda items/subject briefings for their tenant group to discuss with their landlord.  TPAS Cymru have created a briefing series that we call ‘The Agenda’ which provides tenant groups with an overview of a subject and suggestions of questions you might want to ask in your engagement with your landlord.  This briefing will focus on the following:

Service charges

Some tenants pay service charges for the property they live in.  Service charges cover the costs of maintaining communal/shared areas or services for your estate and/or block of properties. Services charges are different to the rent tenants pay. Rent covers maintenance, repairs, and the cost of managing your home.

Landlords often provide a wide range of extra services these differ depending on the type of property and any local facilities available. Not everyone receives these services as they may not be relevant to all property types. Here are a few examples of the services that may be funded by service charges:

• Caretaking
• Lift maintenance
• Door entry maintenance
• Gardening of communal areas
• Lighting in communal areas
• TV and digital aerials
• CCTV
• Fire equipment protection

In some cases, service charges may be personal to the tenant such as:

• Personal heating and hot water
• Personal water rates
• Emergency Link /care line services.

Most service charges are called ‘variable’ service charges. A variable service charge is usually based on the actual cost of providing the service or services and can go up or down accordingly.  Service charges are generally estimated at the beginning of each year based on previous costs and estimated spend.

The expected cost of providing the service is generally split equally between the properties receiving the service on the estate or in the scheme or block. For example, a block of 40 flats may have service charges for e.g. grass cutting, window cleaning, and CCTV of £2000 for the year. Therefore, each flat will be charged £50/year.

Service charge budgets need to be prepared carefully to make sure that they are realistic, reasonable and provide value for money

Questions to ask your landlord:

• How is the quality of services, paid for by service charges, monitored and checked?

• How does the landlord ensure service charges provide value for money?

• What information is given to tenants about service charges and how they have been calculated?

• What can tenants do if they’re not happy about service charge costs or the quality of the services they pay for?