If you are considering block management and are a leaseholder, you may have thought about whether to self-manage or appoint an agent. This could be due to a bad experience with a previous block managing agent or if you are looking to save costs on block management. However, there are a large number of factors to consider. If a block is not managed correctly it can lead to heavy fines and costs more in the long term. Here we will cover some of the problems of self-managing as well as how appointing a block manager can help prevent certain issues from arising.
If you are currently self-managing your block, you may have uncovered problems with financial liabilities. For example, insurance products taken out against single blocks may not cover all aspects of block management. It may not cover things like damages or alternative accommodation needed by tenants if required. ‘Unauthorised extras’ which maybe you haven’t thought of in order to manage a block can mean a budget being incorrectly spent and then facing the difficulty of recouping the expenses.
A block managing agent will make sure that all finances are taken care of legally and efficiently as well as ensure the correct insurance is in place to cover your block
Another important aspect of block management that can be an issue for self-managed blocks is the complexity of leasehold legislation. In England, The Leasehold Reform (Ground Rent) Act 2022 will change how ground rent works significantly. In Wales, the Renting Homes (Wales) Act 2016 will substantially diverge the rules in Wales from those in England. And in Scotland, new land ownership transparency measures are being introduced that freeholders and leaseholders will need to comply with. In addition, the ever-evolving legal stance on cladding issues can also be a minefield to keep on top of.
Appointing a block managing agent would be tasked with keeping up with law changes and implementing the action required before the changes come into effect to ensure the block remains compliant.
Whilst self-managing a block could seem like a cost-effective solution, although you are saving the cost of appointing a block manager, you will need to assess whether you are in a position to ensure further cost savings to the block in addition to this. For example, organising major works and repairs on a block. This can be a challenging task for self-managers who may not have the links with local contractors, construction companies and utility providers that a managing agent would have.
Using a block manager would ensure competitive quotes for the works that need to take place as well as issuing Section 20 notices for major works if required. In addition, block managers have access to the latest administration software which allows them to keep on top of compliance, whilst running the day-to-day operations of a block as well as planning other items months in advance.
As well as ensuring the block remains compliant, keeps up with legislation changes, and cost-saves in areas such as major work, it’s also important that you appoint the right managing agent for you. At Seraph Property Management we provide a latest new blog that goes over in-depth all the legal changes occurring, as well as having MD Douglas Haig, at the forefront of legislation changes in the industry.
Additionally, we make sure that all of our had picked property management team are informed about these changes long before they come into effect, with all block managers looking to achieve a minimum IRPM Foundation Level in their field. A block management company will be more than happy to work with leaseholders to ensure the best relationship going forward with a seamless transition.
Overall, there are many risks that come with self-managing a block that can be eliminated by choosing to work with a reputable block management agency, such as Seraph. If you are a leaseholder with a self-managed development please feel free to contact us here to learn more about what services we provide.