Different service charges for flats in same block?

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    Different service charges for flats in same block?

    Hi,

    We are planning to buy a flat in Maida Vale, but we are afraid (do not understand) service charges for the flats there. Most of the the flats have share of freehold, never the less service charge differs between almost identical flats a lot. We have seen two very similar flats in to very similar blocks, both built in 1930, one has service charge 5000 a year the other 2500. Both flats have share of freehold.
    Any idea what might be the reason or can someone recommend where to look for the answer?

    (the one that has service charge 5000 has porter and a lift, but could this make such a big difference, both flats have communal gardens)

    Thanks a lot,
    Evgeny & Ksenia

    #2
    If the porter is paid £20,000 a year, the real cost of employing him will be something like £40,000. The lift would be maybe £10,000 a year.

    £50,000 divided by £2500 is twenty. If there are more than twenty flats in the block, you are getting a good deal.

    On the other hand, if you want to lug your groceries and parcels up many flights of stairs, go for the block without porter or lift!
    To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.

    Comment


      #3
      Hi jamesknight0,

      Thank you for the reply!

      Block has about 100 flats.
      Also maintaining a lift should not cost a lot, I checked briefly internet maintainance cost for a lift is about 100 pound per visit. They need to make 4 visits a year, so probably should not cost more than a 1000 a year. If anyone think I am wrong please correct me, i just briefly google lift maintance costs.

      I think you are partilly right it is probably due to the porter and a lift, but it should be something else.

      Does anyone has a typical breakdown for the service charge for 1930 mansion block?

      Thanks,
      Evgeny

      Comment


        #4
        Aside from the factors you mention that might explain the variation in service charge, others might include: -

        1. Building Insurance - this is usually a large item and one block may represent a greater hazard than another, or maybe is less astute at buying insurance.

        2. Reserve Fund - the block with the high charge may be building up a reserve fund to meet large scale works: the other block may have done so in the past or maybe is not troubling to do so.


        You could ask to see the most recent service charge accounts for each block. These would be disclosed in the normal course once you have had a bid accepted but, clearly, you would need sight of them in advance of reaching that stage to compare and contrast.

        Comment


          #5
          Different service charges for flats in same block ?

          Your post is not entirely clear to me, whether you are talking about flats in the same block or whether you are checking out different blocks of flats.

          However, lift maintenance is very much more expensive than you would imagine - four lifts in four blocks in the mansion flats where I live have cost over £65,000 over the last (I think) seven years. They are constantly damaged by improper use, usually builders.

          £2500 is on the low side for running any block of flats in Maida Vale properly, so is £5000, looking to future maintenance issues.

          Comment


            #6
            If you go and have a quick browse through previous LVT decisions, 'lifts' fetaure quite a lot and the costs can be very expensive, far more than the £100 per visit you quoted, they are very complicated expensive items, £100 a visit is more likely the cost of getting someone to quickly check your boiler or a basic service on a car.

            Andy
            Advice given is based on my experience representing myself as a leaseholder both in the County Court and at Leasehold Valuation Tribunals.

            I do not accept any liability to you in relation to the advice given.

            It is always recommended you seek further advice from a solicitor or legal expert.

            Always read your lease first, it is the legally binding contract between leaseholder and freeholder.

            Comment


              #7
              Originally posted by evgeny View Post
              Hi,

              We are planning to buy a flat in Maida Vale, but we are afraid (do not understand) service charges for the flats there. Most of the the flats have share of freehold, never the less service charge differs between almost identical flats a lot. We have seen two very similar flats in to very similar blocks, both built in 1930, one has service charge 5000 a year the other 2500. Both flats have share of freehold.
              Any idea what might be the reason or can someone recommend where to look for the answer?

              (the one that has service charge 5000 has porter and a lift, but could this make such a big difference, both flats have communal gardens)

              Thanks a lot,
              Evgeny & Ksenia
              If both those flats are for sale, visit each selling Estate Agent and look at the [notorious] HIP. L's service charge calculations may be amongst the documents provided in the Pack, and a copy of the Lease certainly should be, so you could hope to discover why there is such a discrepancy.
              JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
              1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
              2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
              3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
              4. *- Contact info: click on my name (blue-highlight link).

              Comment


                #8
                Lifts are notoriously expensive to maintain regardless of whether they are in Maida Vale. You are seriously underestimating if you think it only costs £100 every three months.

                You need a lot more information about each building’s condition, services provided, sinking fund, future planned works, buildings insurance premiums, the respective freeholders’ attitude towards maintenance.

                Comment


                  #9
                  Not to mention the extra top up service charges levied for emergencies, etc. which can easily be £10,000 every three years or so, or £40,000 every ten years. The block's history re maintenance, etc. needs to be looked into as well.

                  Comment


                    #10
                    Originally posted by Poppy View Post
                    You need a lot more information about each building’s condition, services provided, sinking fund, future planned works, buildings insurance premiums, the respective freeholders’ attitude towards maintenance.
                    As I said, see documents in each flat's HIP.
                    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                    4. *- Contact info: click on my name (blue-highlight link).

                    Comment


                      #11
                      thanks everyone!

                      The difference was due to the reserve fund for one of the flat

                      Comment


                        #12
                        Some service charges in Mansion Blocks located in Central london are high because of
                        (1) provision of 24 hour supply of hot water for entire block from a central boiler.
                        (2) porter and cleaning service is offered on 24 hour basis rather like in a hotel.

                        Comment


                          #13
                          Originally posted by Gordon999 View Post
                          Some service charges in Mansion Blocks located in Central london are high because of
                          (1) provision of 24 hour supply of hot water for entire block from a central boiler.
                          (2) porter and cleaning service is offered on 24 hour basis rather like in a hotel.
                          I rather think that the problem was the divergence of charges levied, not that they're high.
                          JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                          1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                          2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                          3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                          4. *- Contact info: click on my name (blue-highlight link).

                          Comment

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