A Housing Forum Good Practice Guide 22 Sustainable Leasehold and Long-term Asset Management Undercharging for management services and admin fees Housing associations may find it difficult to assess the time they spend dealing with leaseholder issues and the administration fees associated with those costs. Accurately recording time spent on each project is the only way that this issue can be addressed. If leaseholders are not charged for the full cost of management time and services, together with administration costs, it can mean tenants’ rents effectively subsidise leaseholders’ services. Resolving the overlapping roles for management charging It can also be difficult for housing associations when external agents and housing management staff are being used. But if the landlord’s officers do not leave the external agents to deal with matters, then they are effectively using their time but are not recovering costs for that. Again, in order to be fair to everyone, officers need to be trained to understand that they must be consistently commercial, fair and reasonable throughout. Writing off costs is something a commercial landlord would not do. To successfully manage leasehold property, social landlords need to adopt a commercial mind-set. That said, housing associations are not always providing value for money for leaseholders because: l Services are often delivered through inflexible partnering contracts designed for social housing. l On some Section 106 schemes there is the risk of double charging of shared owners by managing agents and landlords. l Asset management focuses on social housing standards, health and safety, Decent Homes, environmental efficiency and stock condition. It does not tend to consider the needs or views of leaseholders. Balancing the provision and management of services and costs Some housing associations can have a very poor track record in managing leaseholder services, such as service charges, service of formal notices, consultation, billing and debt collection. This may be understandable: they want to help people, and provide low cost housing, so getting tough with leaseholder problems can conflict with their natural instincts. l Accounting and partnering practice on contracts works mean it is not easy to be transparent and demonstrate good value. This can affect satisfaction levels and even create the false impression that leaseholders are subsidising tenants. Some working group members were concerned about charging management fees on the cost of the works, which can often be in addition to any professional fees or preliminaries. This is a major bone of contention with leaseholders. Many working group members felt that there were savings to be made in the Some working group members were concerned about charging management fees on the cost of the works, which can often be in addition to any professional fees or preliminaries.
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