What is a leasehold service charge?
Service charges are contributions due under the terms of your lease towards the costs of maintaining and providing services for the block and estate in which you have your property.Each leaseholder has to pay a share of the overall cost for providing these services.
You normally pay service charges if you live in a flat, or a house that has communal areas, and/or where there are annual servicing contracts in place.
Typically, service charges might cover:-
- cleaning communal areas
- maintaining lifts
- gardening in communal areas
- maintaining and redecorating buildings
- electricity in communal hallways, street lighting, external security lighting
- annual servicing of emergency lighting
- contributions to the repair or replacement of major items, such as door entry systems or lifts
- surveyors and/or other consultants fees and costs
- management costs incurred in setting up contracts and providing services
- renting and repairing the television aerial
- maintaining fire alarms
- other services as defined in your lease
How is my service charge estimate calculated?
Annual service charges vary depending on the type of home you live in as well as by whether you are a tenant or leaseholder.
They’re estimated by looking at the cost of services for a property in previous years and then working out the cost for the coming financial year.
Service charges are set from April each year based on the services you receive and the contracts we hold. Charges are calculated for service for operational staff such as caretakers, cleaners and gardeners, these are set for each estate or block.
Those costs are apportioned (by unit numbers in Walsall or rateable value in London) across the relevant units within the estate or block. If there are different types of blocks on an estate (e.g. high rise and low rise) then some of the costs may be apportioned only to blocks that benefit from that type of service e.g. a lift, therefore a low rise block which does not have a lift do not pay a service charge for lifts but high rise blocks will.
In 2023/4 the full cost of services are being recovered in the weekly service charge. This charge is different for different blocks and estates as there are different services, contracts and suppliers, including energy suppliers whose prices are increasing at different rates.