Service Charge Money

LauraWxx

Hi All,

Wondering if anyone can advise ...

I completed on a new build apartment at the end of August, at that time we had to pay our service charge payment up until the end of the year which was a total of around £400.

The management company are still yet to take over so none of the routine work that was meant to happen has been happening...eg cleaning of communal areas etc.

I have spoken with the house builder who have advised that the management company are due to take over very soon and I enquired that all of the money paid would be going to the management company and not retained by the developer to which I was assured that the money was ring-fenced and would be going to the company.

My question now is - are we entitled to any of the money back...if they were to hand over to the management company today, that is two months that we have paid our service charge for but not been receiving the service.

Can anyone advise if this is the case or not??

Fire_Fox

It's worth running an advanced search, perceived overpayments of service charges has come up many times. Are you sure nothing is being done? How much of that £400 is buildings insurance, how much is for electricity for lighting and lifts? Are your fire alarms not being tested? Read your long lease and the LEASE website, in general overpayments just roll over they are not refunded.

TBH you are better off setting money aside every month and having a little float, with a new build the service charges are often set artificially low initially and leaseholders experience massive hikes in the early years.

LauraWxx

Thanks for the reply Firefox....I have a breakdown of the service charge spending somewhere so will check that out.
I will have a look on the websites you suggested as well thank u!

Fire_Fox

No problem, add to the thread if you are unsure about anything.

propertyman

LauraWxx wrote: »

My question now is - are we entitled to any of the money back...if they were to hand over to the management company today, that is two months that we have paid our service charge for but not been receiving the service.

Handover is a common misunderstanding in new builds.

It matters not whether it is the developer or agent is " in charge" as the lease,which sets out how service charges are calculated, treats as expenditure as continuous.

Think of it as simply a change of manager and signatories on the bank account, and not a change of say a utility supplier opening and closing an account- it isn't. Your account is always with the Landlord in the lease ( its shown on the bills)

Once you have found your break down the next step is your lease.

1: Service charge are estimated" what they plan to spend" for a year in advance, find that start and end of the year- typically 31st Dec or Mar 30th June or Sep ( or even the old quarter days 25 D 25 M 24 J 29 S). You pay a amount in advance.

2: Certification or Accounts. This is the clause in the lease which means that "what was spent" is added up and deducted what was paid in adavnce.

The difference is either refunded, rolled into the current year, or put in the reserve fund- which spends on what your lease says.

Hope that helps.