Apartment & flat service charges :-(

[standardpostage]

I have been accompanying an elderly friend, looking for a new home, he is downsizing. His wife died a few years ago.

Two apartments we viewed have service charges. One was £132 a month and the other was £155 a month.

I think service charges are a rip off and extortionate.

What are your thoughts on service charges ?

Fair,  overpriced , or not value for money ?

[Watts.E.Dunn]

Depends on where it is, london central maybe ok, anywhere else maybe a rip off as most are...

[paul_tall_]

I have been accompanying an elderly friend, looking for a new home, he is downsizing. His wife died a few years ago.

Two apartments we viewed have service charges. One was £132 a month and the other was £155 a month.

I think service charges are a rip off and extortionate.

What are your thoughts on service charges ?

Fair,  overpriced , or not value for money ?

What does the service charge include ?

[PilotMan]

It depends on the location and what the service charge covers.

A friend of mine owns a very large four bedroom apartment in a converted former historic manor house, which is set on a large estate. He pays £1,000 per month service charge.

I've got a 2 bedroom apartment in Woodford Green Essex, the service charge is £750 per quarter. It covers grounds maintenance, elevator maintenance and cleaning of the common parts. The grounds are about 1/2 acre.

[DastardlyDick]

As said, it depends on what the service charge includes.
I've never understood why things like cleaning of common added etc aren't just included in the basic rent/lease cost rather than a separate item since they are a mandatory payment.
If you find them "extortionate" and "a rip off" then don't live there and find somewhere that charges a more acceptable amount.

[standardpostage]

What does the service charge include ?

As far as I know; buildings insurance, exterior window cleaning, hallway and staircase lighting, hallway and staircase sweeping. That's it I think.

No gardens outside. It's an old converted building. 8 apartments over 3 levels. Area is Rossendale in East Lancashire.

[PilotMan]

As far as I know; buildings insurance, exterior window cleaning, hallway and staircase lighting, hallway and staircase sweeping. That's it I think.

No gardens outside. It's an old converted building. 8 apartments over 3 levels. Area is Rossendale in East Lancashire.

You might also want to check if there is any element of the service charge contributing to a "sinking fund" for major repairs.

Is there an existing fund, how much is in it, are any major repairs expected?

How much of the current Service Charge is going towards the fund?

[Adoniron]

A service charge is just dead money. Do you really get good value for it? Thousands of pounds a year for cutting the grass and cleaning the common parts. Also the mechanisms for increasing them can be opaque. One reason why I would never live in an apartment again.

[PilotMan]

A service charge is just dead money. Do you really get good value for it? Thousands of pounds a year for cutting the grass and cleaning the common parts. Also the mechanisms for increasing them can be opaque. One reason why I would never live in an apartment again.

It all very personal.

Some people just don't want the hassle of being responsible for maintenance, but want to live in a place that is well maintained, maybe with a communal garden, concierge etc.

My mother had a big four bedroom house with a huge garden and a very large natural pond. She no longer wanted the hassle of maintaining it. So the convenience of living in an apartment with communal gardens that was fully maintained, outweighed the cost and she no longer had to deal with everything.

Some places are almost exclusively apartments, such as Central London. Similar to the situation where someone can't afford a house in their area, so have no choice but to have an apartment.

[paul_tall_]

A service charge is just dead money. Do you really get good value for it? Thousands of pounds a year for cutting the grass and cleaning the common parts. Also the mechanisms for increasing them can be opaque. One reason why I would never live in an apartment again.

Its not just apartments that have service charges, most developments over the last whatever years have it for so called maintenance of land etc Ok not as much as the friend of the op but the charge where  i am has rocketed esp the admin fee in last few years and includes things now such as terrorism insurance.

[Stevelondon]

I downsized a few years back. Me and the cat wanting a place with a garden rather than a flat….. or an apartment if your posh. 

Viewed a few places before settling on the one we are in now. One house being on a new small development, freehold. But there was a service charge because of the landscaping that was part of the development. 🤷🏼

There is an American style estate of houses in Worcester Park (Hamiltons) that has this too.

[standardpostage]

You might also want to check if there is any element of the service charge contributing to a "sinking fund" for major repairs.

Is there an existing fund, how much is in it, are any major repairs expected?

How much of the current Service Charge is going towards the fund?

Never heard of "a sinking fund" thanks for information. Will pass info to friend 

[Corus Boy]

A service charge is just dead money. Do you really get good value for it? Thousands of pounds a year for cutting the grass and cleaning the common parts. Also the mechanisms for increasing them can be opaque. One reason why I would never live in an apartment again.

The 'Contingency' fund. I have an flat roof, apart from day-to-day costs of specialist cleaners and small repairs. There is an ever increasing fund for when a new roof is required, currently, across the apartment complex, the Conservative estimate is £1,000,000 or £2,000 an apartment. There is also a secured parking compound for 550 vehicles that will need resurfacing. And please don't mention the cost and demand for EV charging points.

Oh and there is cladding!

[mr712]

I hate it. Mine’s over £200/m (in Liverpool; not a very high CoL city) in a complex that has very little in terms of grounds or amenities to be maintained. God knows where the money goes.

It feels like I’m somehow paying both rent and a mortgage.

[PilotMan]

Never heard of "a sinking fund" thanks for information. Will pass info to friend 

As @Corus Boy said, also known as a "contingency fund".

[standardpostage]

I should imagine, although, I am only guessing, that there is a "profit margin", built into the "service charge" 

[RandomGuy99]

In the UK, **service charges** are fees that leaseholders (and sometimes tenants) pay to landlords or managing agents to cover the costs of maintaining and running the building and communal areas. These are common in leasehold properties, especially flats/apartments.

### 🔍 What Do Service Charges Cover?

Service charges typically cover:

* **Cleaning and maintenance** of communal areas (hallways, lobbies, gardens)
* **Lift maintenance**
* **Lighting** and **heating** in shared areas
* **Building insurance** (not contents)
* **Repairs** and **general upkeep**
* **On-site staff** (e.g. concierge, security)
* **Management fees**
* **Reserve or sinking funds** (for major future works like roof replacement)

### 💷 How Much Are They?

The amount varies widely depending on:

* **Location** (London tends to be higher)
* **Size and facilities** (e.g. gym, concierge, lifts)
* **Age and condition** of the building

Typical service charges can range from **£1,000 to £2,500 per year**, but luxury or central London flats can exceed **£10,000 per year**.

### 📃 Legal Aspects

* **Transparency**: Landlords or managing agents must provide a **breakdown** of how charges are calculated.
* **Challengeable**: Leaseholders can **challenge unfair service charges** through a First-tier Tribunal.
* **Lease details**: The lease will state what services can be charged for and how.

### 🏦 Reserve or Sinking Fund

This is a pot of money collected in advance to cover **large-scale future repairs** (e.g., roof, cladding). It's meant to avoid sudden large one-off bills.

### 🏘️ Freehold vs Leasehold

* **Freeholders** generally don’t pay service charges unless it's a shared estate with private roads or communal gardens.
* **Leaseholders** almost always do.

[RandomGuy99]

Great question — and the short answer is: **not directly**, but they often do **indirectly**.

### 🔹 Can Service Charges Legally Include Profit?

Under UK law, **service charges are meant to be "reasonable" and reflect actual costs**, not to generate profit for the freeholder or managing agent. The law is clear on this:

* **Landlords/freeholders** can only charge for **actual costs incurred** in providing services.
* They cannot **mark up** services just to make a profit.
* This is governed by the **Landlord and Tenant Act 1985**, which protects leaseholders.

### 🔹 So How Do Companies Still Make Money?

Here’s how profits can sneak in:

#### 1. **Management Fees**

* Property management companies are allowed to charge a **management fee** for administering the services.
* This is usually a percentage of the service charge budget (e.g., 10–15%) or a flat fee per flat.
* This **is** profit-making and legal, but it must be reasonable and proportionate.

#### 2. **Connected Contractors**

* Sometimes the freeholder or managing agent hires **contractors or suppliers they own or are linked to**, who charge inflated prices for cleaning, repairs, or maintenance.
* This is a grey area, but **if the prices are unreasonably high**, leaseholders can challenge them at a **First-tier Tribunal**.

#### 3. **Overcharging or Lack of Transparency**

* Some managing agents **inflate budgets** or charge for unnecessary services.
* Many leaseholders don’t question it, so these practices can go unnoticed.
* However, leaseholders have the right to request **detailed accounts** and **challenge any unreasonable charges**.

---

### 🔍 Leaseholders’ Rights

You can:

* Request a **summary of costs** (Section 21 request)
* See **supporting invoices and receipts**
* Challenge charges through a **First-tier Tribunal**
* Form a **Residents’ Association** or take over management via **Right to Manage (RTM)** if you're unhappy

---

[standardpostage]

Good answer, thanks RandomGuy99 

[Cappadonna]

Just an unavoidable rip off. Always thought flats & apartments where cheaper & better value,

A friend owns a very nice flat in a nicer area of Glasgow. Everyone had to pay £10k for lift maintenance. Even folks on the ground floor. 

[RandomGuy99]

Good answer, thanks RandomGuy99 

ChatGPT produced answer

[RedKettle]

Sometimes it is not a direct rip off as such just that the managing agent (or whoever is doing it) is lazy and does not challenge contractor costs or shop around in the way that you might do if it is your own money.  Sometimes for example you can look at the accounts and think that you would be happy to cut the grass for half what they are paying.

[Markus]

They exist for people who can’t be bothered and also for people who can’t afford houses unfortunately.

As someone who lives in a semi detached house,  I am in two minds about service charges.  On the one hand, it’s not like maintaining a house on its own is cheap.   Garden waste bins,  gardening service,  repairs,  plumbing,  cleaning etc is all either at your own cost or need to be done by yourself so time consuming.   My garden was out of control so I brought it down the bare minimum with a small patch in the front and back with a side hedge.    It was a complete jungle before but these days I can do it myself if I’m free and it would take me a day to finish everything.   

On the other hand it seems proportionately these charges are big, even for new builds that require very little maintenance or should do.    I have a friend who hates living in a flat with service charges.   They have no garden or lift , only a small hallway and pay £100 a month for someone to basically clean the halfway. 

[southcoastpunter]

  They have no garden or lift , only a small hallway and pay £100 a month for someone to basically clean the halfway.

as has been said, it is not just to clean the hallway. if no lift presumably it has stairs and a landing/small hallway on upper floor(s), there is lighting in hallways so a separte meter and costs there, plus building insurance, public liability insurance, and contingency for outside and inside (hallway, stairs etc) maintenance, future roof repairs, outside painting, burst water pipes, bin areas etc etc.

More and more rights are being given to tenants so its worth having a "residents assocation" type body!

[PilotMan]

They exist for people who can’t be bothered and also for people who can’t afford houses unfortunately.

You're naive or delusional fella.

Some people want the convenience of not having to deal with a house, they don't want to maintain a garden or anything else. It's not that they can't be bothered,  they have other things they want to do,  that's more important to them.

It's a choice, not misfortune.

Plenty of apartments around that are way bigger than your semi.  As for can't afford a house, try buying a two bedroom apartment in central London for less than £1M

On the other hand it seems proportionately these charges are big, even for new builds that require very little maintenance or should do.    I have a friend who hates living in a flat with service charges.   They have no garden or lift , only a small hallway and pay £100 a month for someone to basically clean the halfway.

To pay a flat fee and have someone else take care of everything, on time every week, meaning you don't need to book trades people or manage them etc.

To busy people with other priorities, that's a huge plus.

[Darren101]

Ignoring central London, pretty sure buying a house in suburbs is a lot more than a flat so people can only afford to go with the flat. Moving far far away for something cheaper isn’t something everyone wants. Many would opt for a house in the same area but can’t.

ANYWAY, Must vary from place to place but they can be such a rip off and you can get dragged into paying extortionate extra fees for maintenance as well as the service charges rising extortionate amounts. There are also cases of maintenance being neglected or done poorly so tenants don’t get good VFM.

Plenty of horror stories plus unjustifiable price increases and extra costs. Sister couldn’t wait to get rid of her flat due to crazy increases and kept having to deal with it through an association. Such a hassle. Colleague had a £5K bill which had to be disputed by him and neighbours when it should have cost a few hundred each.

Worse if it’s a council property and you have so little control. While it is paid for the maintenance and upkeep and not supposed to be profit, I bet there’s plenty of profit by the management agent by over inflating costs they charge or lack of effort of finding reasonable quotes.

Not saying it happens everywhere but the cost will go up and even unaffordable for some over time.  So bad for some the flat becomes unsellable.

Just doing some Google’ing. 

External Link/Members Only

This is Shared Ownership but ouch…
External Link/Members Only

The system is open to abuse and quite ridiculous and not fit for purpose, especially in London. Smaller block of flats might be less hassle.

[DastardlyDick]

Just an unavoidable rip off. Always thought flats & apartments where cheaper & better value,

A friend owns a very nice flat in a nicer area of Glasgow. Everyone had to pay £10k for lift maintenance. Even folks on the ground floor. 

A friend of mine lives in a block with a lift, but ground floor flats don't pay for it's maintenance having objected as they don't use it.

[standardpostage]

Ignoring central London, pretty sure buying a house in suburbs is a lot more than a flat so people can only afford to go with the flat. Moving far far away for something cheaper isn’t something everyone wants. Many would opt for a house in the same area but can’t.

ANYWAY, Must vary from place to place but they can be such a rip off and you can get dragged into paying extortionate extra fees for maintenance as well as the service charges rising extortionate amounts. There are also cases of maintenance being neglected or done poorly so tenants don’t get good VFM.

Plenty of horror stories plus unjustifiable price increases and extra costs. Sister couldn’t wait to get rid of her flat due to crazy increases and kept having to deal with it through an association. Such a hassle. Colleague had a £5K bill which had to be disputed by him and neighbours when it should have cost a few hundred each.

Worse if it’s a council property and you have so little control. While it is paid for the maintenance and upkeep and not supposed to be profit, I bet there’s plenty of profit by the management agent by over inflating costs they charge or lack of effort of finding reasonable quotes.

Not saying it happens everywhere but the cost will go up and even unaffordable for some over time.  So bad for some the flat becomes unsellable.

Just doing some Google’ing. 

External Link/Members Only

This is Shared Ownership but ouch…
External Link/Members Only

The system is open to abuse and quite ridiculous and not fit for purpose, especially in London. Smaller block of flats might be less hassle.

[paul_tall_]

They exist for people who can’t be bothered and also for people who can’t afford houses unfortunately.

As someone who lives in a semi detached house,  I am in two minds about service charges.  On the one hand, it’s not like maintaining a house on its own is cheap.   Garden waste bins,  gardening service,  repairs,  plumbing,  cleaning etc is all either at your own cost or need to be done by yourself so time consuming.   My garden was out of control so I brought it down the bare minimum with a small patch in the front and back with a side hedge.    It was a complete jungle before but these days I can do it myself if I’m free and it would take me a day to finish everything.   

On the other hand it seems proportionately these charges are big, even for new builds that require very little maintenance or should do.    I have a friend who hates living in a flat with service charges.   They have no garden or lift , only a small hallway and pay £100 a month for someone to basically clean the halfway.

As i mentioned further up it’s not just flats that pay service charges these days. Plenty of freehold property holders have yearly service charges . Obviously flat charges are more expensive in the main .