Service Charges are a key area of friction between residents and property managers, and paying for unexpected repairs or maintenance can be a thorny issue for flat owners.
Most well-managed blocks have reserves to call on when major refurbishment or repairs are needed, but for those unable to build up suitable funds – and obsolete equipment urgently needs replacing – residents are expected to put their hands in their pockets and split the cost.
Imagine this scenario. You live in a small block of six flats where four out of the six residents are tenants and two are owner-occupiers. The four buy-to-let landlords are unwilling to contribute large sums to a reserve fund when they may sell their flats in the next few years.
The lighting in your communal areas is dated, lamps are constantly failing, and your lighting bill is getting higher every year. Wholesale replacement is unaffordable for the two flat owners by themselves and the constant maintenance is getting everyone down. What do you do?
London-based Future Lighting thinks it has come up with a solution – leasing. A relatively new phenomenon in the leasehold sector, leasing gives flat owners the opportunity to commission a full block-lighting replacement programme that can be purchased on a buy now, pay-as-you-go basis. Future Lighting has partnered with leasing specialists Clear Asset Finance to offer a package to customers that won’t break the bank.
The company only underwrites businesses, not individuals, in the residential market but is happy to talk to property management companies and RTMCos.
The first step is a free site survey to assess lighting requirements. Once credit checks have been made, an agreement is finalised via Clear Asset Finance and the new lighting can be installed.
The benefits of leasing are easy to assess:
- A repayment plan tailored to meet the needs of the client;
- Fixed payments agreed in advance to avoid nasty service charge surprises;
- No more costly maintenance call-outs;
- Up to 75% savings on energy bills by replacing old systems with new, energy-efficient alternatives.
Some blocks can even expect a new lighting installation to have paid for itself by the time the finance plan is fully paid up.
On one of their recent projects, at Broadwalk House adjacent to London’s Hyde Park, the total cost of replacing the lighting system with an energy-efficient alternative was just over £15k.
Prior to replacing the lighting system, the electricity used was calculated at just over £8,500 per annum. Now it is expected to be just under £500 per annum, and residents will start to see a return on their investment after just 21 months.
So huge savings can be achieved without any initial outlay on the part of flat owners, who are able to set up a leasing agreement over a maximum of five years – less if it suits them.
Jamie Willsdon is managing director of Future Lighting