Service Charges

Service charges are costs you pay if you’re a leaseholder or shared owner, they cover the cost of maintaining the building that you live in.

The service charges annual cycle

 mhs homes service charge

Our financial year runs from 1 April to 31 March the following year.

Each February we send a letter to leaseholders and shared owners telling you the amount we estimate the service charges to cost for the coming financial year. We call this your service charge estimate.

In April to July we work out the year end costs for the previous year.

Every year in September we send letters and statements to explain the year end service charges so you can compare them with the estimate from the previous year. We call this your service charge year end statement. Your account will be adjusted by the end of September to show your surplus or deficit.

In October to December your estimated charges for the following year are prepared.

Frequently asked questions

For leaseholders:

The estimated charges are payable by four equal instalments on 24 June, 29 September, 25 December and 25 March according to your lease. But many people prefer to pay monthly by direct debit.

For shared owners:

The estimated charges are payable monthly along with your rent.

The actual year end surplus or deficit will show in My Account at the end of September. If you owe us, payment must be paid within 28 days.

On your year end statement, you’ll see how we’ve worked out the final figures.

You’ll then be able to see if you owe us any money or if we owe you.

If you owe us money, you can pay by setting up a Direct Debit or make a single one-off payment.

If your statement shows a surplus on the bottom line, we’ve spent less on maintaining your building than we estimated. It’s shown with a minus sign in front, for example:

-£50.00. We’ll credit your account with the amount shown on your statement.

If your statement shows a deficit on the bottom line, we’ve spent more on maintaining your building than we estimated and you now owe us the amount shown. We’ll debit your account with this amount.

Here’s a summary of what your service charges could cover. (It might be that not all of these apply to you and your home).   

Building insurance: We insure the building as a whole with a single insurer. But we don't insure your belongings. You need to insure your contents against accidental damage such as theft and water leaks. We can’t stress enough how important this is. There are lots of insurance providers out there, just search ‘contents insurance'. 

Caretaking: Cleaning and maintaining communal areas like corridors, lifts, walkways and bin/shed enclosures. It also includes litter picking from paths, grassed and drying areas, removing fly tipping, twice yearly bin cleaning and reporting communal repairs.

Communal aerials

Communal general repairs: We sometimes have to make repairs to the structure, external and communal parts of a building. This also includes communal cleaning done by an external contractor.

Communal glass cleaning

Lighting maintenance: This includes maintenance of lighting in your block and communal area. Lighting timers are changed twice a year in spring and autumn, to make sure hallway lighting is safe.

Door entry system: If your block has one, this covers the cost of repair and maintenance as well as the cost of the telephone line.

Grounds maintenance: Maintaining communal land including flowerbeds and shrubs twice yearly, grassed areas cut between March and October, yearly tree inspections, hard surface weed spraying three times a year. Removal of fly tipping.

Lift maintenance: This includes yearly planned and preventative maintenance measures, reactive repairs, electricity, the lift phones/alarms and inspections.

Security maintenance: this includes car park barriers, CCTV, electric gates.

Water charges (communal): This covers the cost of water used by our caretaker.

Gas charges (communal): This is if your block has a central boiler that heats the whole building.

Electricity (communal): This is the cost of electricity to all lighting and equipment in the block.

Equipment maintenance: These are the costs of inspecting and maintaining all fire safety equipment, pumping equipment and any other mechanical and/or electrical equipment in the communal areas serving the block.

Management company: This’ll include things like insurances, ground rent, estate management charges. These are usually for newly built homes because the developer will appoint a management company.

Major work: We regularly do work to the structure and outside of your block. These are usually done under contracts with external firms. If the work is going to cost more than £250.00 per household, we’ll consult you about it.

Reserve funds: These are funds we build up that remain with your property for work to roofs, lifts, and planned internal/external redecorations and repairs. We know these costs can be high, and we use money from the reserve funds we’ve collected for your block towards the cost. For some properties we also collect a general reserve fund to put towards replacement or maintenance of other substantial items, such as door entry systems.

Annual audit fee

The final accounts are reviewed every year by independent auditors. This is to:

• check the service charge year end statement is a fair summary of the costs
• provide value for money
• comply with the law

Management fee

This is the administration cost for mhs homes for providing services and repairs. 

The amount of management fee charged to you depends on the total cost of your contribution for services and repairs. The fee is set at 10% of that sum, plus £50. On most blocks/schemes we don’t include the cost of providing heating, lighting and buildings insurance in the calculation of management fees.

The management fee covers:
• Staffing and office costs of the parts of the Home Ownership team that deal with service charges
• The calculation, billing and collection of service charges
• Providing information about your service charge account and general information on all aspects of home ownership
• The administrative and IT cost of calculating and sending you invoices, statements and accounting for payments made