Rent & service charges
Frequently asked questions
Rent & service charges annual review – April 2011 to March 2012 EDIT
information for leaseholders
Does my lease tell me what method I should through analysing past costs. To help us get these estimates
use to pay my rent and service charge? right, all leaseholders who pay service charges will receive
Yes, your lease specifies that you pay monthly in in January a copy of the proposed service charge schedule
advance by direct debit. This is one of the simplest for the following year. You can then contact us with any
methods to pay, as once it is set up the money is debited comments or questions on the schedule.
from your account automatically. If you would like to set
up a direct debit, or discuss your payment method please Why am I paying more towards the service
contact the customer accounts team on 0845 600 0830 charge than my neighbour?
(Mon-Fri, 8.30am-8.30pm and Sat, 8.30-12.30pm).
The method for charging service charges is set out in your
lease. The cost of providing a service must be shared fairly
What can I do if I’m having problems paying my between all the flats in the building. To calculate your share
rent and service charges? of the cost we look at what is called the apportionment
value of your property compared to the rest of the building.
If you have problems paying your rent, coping with debt, or
The apportionment value is usually based on:
would like advice on welfare and benefits, please contact
us for a free appointment with a welfare and debt advisor. • Number of bedrooms in the property
To arrange an appointment phone 0845 600 0830 (Mon-Fri, • The size of the property
8.30am-8.30pm and Sat, 8.30-12.30pm) or drop into our • The floor level
head office to speak to us at 29-35, West Ham Lane, If your property has a higher apportionment value than
Stratford E15 4PH (Mon-Fri, 8.30am-6.00pm) or email your neighbour’s then you will pay proportionally more for
firstname.lastname@example.org. the services provided.
I am a shared owner, how is my rent reviewed? What happens if the estimate is lower or higher
Your annual rent is reviewed in accordance with your lease
than we have been charged?
which specifies an increase of the retail price index (RPI) To make sure you pay the actual cost of the service, we
plus an additional percentage if your lease specifies. annually compare our estimated cost with the actual cost
This is reflected on your annual rent review letter. over the past year and adjust the charge to take the
difference into account. We tell residents whether the
charge is more or less than the estimate within six months
How does East Thames work out service charges? of the financial year end. For the financial year April 2010
Service charges cover the cost of any communal services. to March 2011 we will be writing to residents by the end
The most common communal services include grounds September 2011 and you will see this difference in your
maintenance, cleaning, replacing light bulbs and fittings statement of accounts.
and electricity usage. The charges also cover the cost of
maintenance and repair to equipment within shared areas
such as lifts, communal TV aerials, CCTV, electronic gates,
Why have I been charged for fire equipment
door entry systems and fire equipment. (Some
when I don’t have an alarm and/or an extinguisher?
leaseholders also pay a personal service charge and this is The fire maintenance contract consists of the maintenance
shown as a separate charge on your schedule.) of fire alarms, extinguishers, lightning conductors, dry
risers, smoke alarms, smoke vents and emergency
We use a variable service charge system to calculate the
lighting. The charge shown on your service charge
charges. This means we estimate the cost of each communal
schedule could be for one or all of these items.
services and charge you your share of that estimate. These
estimates are calculated using contractual information or
Please turn the page >
rent & service charges annual review – april 2011 to March 2012
Information for leaseholders
Why am I being charged for a dry riser, what is it? Why am I being charged an estimate for risk
This is a system of valves and pipe work which enable the assessment - water treatment/legionella?
Fire and Rescue Service to deliver water onto the upper Where there is a water supply that is, or can be, used by
floors of a building in the event of a fire. Buildings with dry more than one person (other than the supply to your
risers will need an annual pressure test and inspection to personal accommodation), an annual assessment must
make sure the equipment is fully operational. We also take place. This is so we can monitor any possible risks to
organise a six monthly visual inspection. All of these the people who use the water supply, such as exposure to
inspections will make sure your building is safe and complies bacteria like legionella and also make sure we take
with Health & Safety standards (BS5306 & BS9990). suitable precautions, to ensure we’re compliant with the
Health and Safety Executive legislation.
Why am I being charged for emergency lighting,
and what is it? How often is the passenger lift maintained?
Emergency lighting is located in communal areas, corridors, Your passenger lift is maintained quarterly. If your lift is not
stairs and possibly outside above exit doors. It will come working, we will aim to get someone out to look at the
into operation in the event of a power failure and will provide problem within 24 hours as a priority.
three hours of reduced lighting to enable people to exit the
building safely. Testing is carried out every six months to
comply with the Health & Safety standard BS5266. Why does the lift engineer sometimes go away
without mending the lift?
This could be because they need to order a special
Why am I being charged for a lightning replacement part or because the engineer does not have
protection system? the part with them on the initial visit. We do everything we
Where lightning protection systems are installed to protect can to try and get lifts back up and running and our
the building, we have a duty to maintain the system in contractors try to obtain the required parts as soon as
accordance with Health & Safety standard BS6651. This possible however, depending on the part availability some
means we organise an annual visual inspection of the lifts may be out of action for a period of time.
system and a continuity test of the earth electrodes. The
annual test is done every 11 months to ensure the system
is tested in different climate conditions. Why do I have to pay for the maintenance and
repair of the passenger lift when I don’t use it?
We follow the directive from National Housing Federation
Why am I being charged for electrical testing? to share the cost of the lift amongst all residents including
We test the electricity service points and cables within those who do not need the lift to access their own homes.
communal areas periodically. These inspections are carried Costs are apportioned amongst all those living in the
out every five years to comply with the following legislation: building in which the lift is located.
Health and Safety standard BS7671, Health & Safety at
Work Act 1974 & 1999, and the Electricity at work
Regulations 1989 & 1992. To make sure your building is Can I get a refund when you have charged me
safe and that we are consistently compliant with this for maintenance of equipment that has
legislation, we will also organise annual tests which are frequently broken down?
charged at a lower rate to the five yearly inspection. The charges for the maintenance and repair of equipment
shown on your service charge schedule are to ensure
continuity of the service through regular maintenance
Why am I being charged an estimate for risk checks and a prompt repair service. With these maintenance
assessment - fire? contracts in place, East Homes does not provide refunds if
To comply with the Regulatory Reform (Fire Safety) Order the service fails.
2005, we undertake fire risk assessments to assess the
risk of a fire starting and the consequences of the fire and/
or smoke. We have a responsibility to reduce the risk Why am I being charged for communal repairs,
where possible and to assist the person who produces the and what are they?
risk assessment for each block. The cost applied in This charge is for repairs to communal areas for things
2011/12 is for a comprehensive assessment which will be like carpets, manual gates, rotary driers and communal
carried out once every four years. During the intervening garden equipment.
years, a systems assessment will be carried out yearly and
charged at approximately 50% less than the charge for the
rent & service charges annual review – april 2011 to March 2012
Information for leaseholders
Why am I being charged an estimate for bulk refuse? The internal cleaning/external maintenance
We have been working hard over the past few years to provided for my block is not carried out to a decent
help residents understand that dumping bulky household standard. Who do I need to contact to report this?
rubbish in and around your development causes many If you are concerned about the standards, please contact
issues, and affects the health and safety of the your neighbourhood manager or call 0845 600 0830,
neighbourhood. Currently this issue is ongoing and an stating where you live and you will be put through to
estimated charge for removal of these items has been the right person.
applied to the estates where we have identified that the
highest and most frequent bulk collections are occurring,
based on the number of pick-ups and advice from our I am no longer paying any administration
neighbourhood managers. charges but my management fee has increased
– why is that?
As other methods have failed, this approach aims to
reduce the amount of bulk left around, to keep your Following audit recommendations and to reflect best
building safe and minimise future costs to residents. If the practice, from April 2011 our leaseholder estimates and
actual cost for this service works out less than the actual service costs will no longer contain administration
estimate, a credit will be shown against this service on charges. You will therefore see a reduction in the cost of
your annual statement of account for 2011-2012. your regular service charges and subsequent deficits for
the financial year 2011-2012 and thereafter. However, for
the same period, the cost of the administration of the
If my charges do not show an estimate for bulk communal and personal services has now been
refuse, does that mean I will not be charged if incorporated into the management fee.
If you do not have an estimate for this service in your 2011- What does the management fee cover?
2012 service charge, but collections are made during that
period, the actual costs will be included as a debit on your The management fee covers the cost of working out and
annual statement of account for 2011-2012. managing services to our leaseholders. It mainly includes:
• A proportion of the staff costs for the departments within
East Homes who deliver services to you such as
Are my services provided by East Homes or a neighbourhood management, customer accounts, rents
managing agent? & service charges, maintenance partnerships,
Where a managing agent wholly delivers services for your procurement and the call centre (this will depend on your
property, the managing agent’s name will be on your type of lease and tenure, some departmental costs may
schedule of charges. Where a managing agent part not be applicable to you).
delivers services for your property, the cost provided by • Overheads such as the cost of the offices which includes
them will be noted on the schedule under Pure services. things like utility and telephony costs, recruitment and
training, insurances and IT.
What do Pure Services cover? • Stationery, printing and postage.
These may include waterways charges and estate costs • And if applicable, there will be a fee charged from a
which are not delivered by us. However, these are charges managing agent where the estate services (or part
for facilities which we agreed to provide as part of our local thereof) are not delivered directly by us.
authority planning approval and without them, we would not
have been able to develop the homes. (They are usually
What is the “Notice to Long Leaseholder of Rent
detailed in either the Head Lease or Section 106 of the Town
Due” enclosed with my rent increase documents
and Country Planning Act 1990.) These planning obligations
and do I need to make a separate payment for this?
are often a legally binding agreement between the local
authority and developer. If you require further details for your This document is for your information only and is only sent
property, please contact your service charge officer. to our long leaseholders. It is the legal format for outlining
the annual ground rent applicable for your property. You do
not need to make a separate payment as the charge is
What are you doing about the overgrown trees incorporated within your total monthly charge.
in the communal areas?
We’ve received many requests to maintain trees within
communal spaces, and so we now have in place a three
year maintenance programme starting April 2011. When
there are costs incurred for your building, they will be,
wherever possible, taken from your sinking fund.
rent & service charges annual review – april 2011 to March 2012
Information for leaseholders
I understand that rent is based on the value of If I am paying insurance to East Homes, do
my property. My property has now gone down in I need to have my own buildings insurance?
value, so why has my rent increased? No, we insure the building as East Homes hold the
The original rent on the unsold equity of your home which freehold and therefore have an interest in the building.
was set at the time of your shared ownership purchase However, you will need to obtain your own contents
was based on the market price of the property as outlined insurance.
in your lease. Any subsequent increases to the rent are
usually due to the specified retail price index (RPI) plus
any additional percentages if specified in your lease. Can I claim Housing Benefit for my service charges?
Any claim for Housing Benefit will be based on your
personal circumstances. Most communal service charges
I am a shared owner - why am I contributing to a are eligible for Housing Benefit, however, any personal
long term maintenance charge? service charges payable such as bulk water, heating or
This fund is for major works to your block which occur electricity charges are at your own cost.
approximately every five years for things like painting
window frames and internal areas, replacing fencing, hiring
scaffolding for these works and also a contribution to future I claim Housing Benefit, whose responsibility is
long term works such as the replacement of roofs in older it to inform them of the increase in my charges?
blocks. Unexpected major works are also charged from this If your Housing Benefit is paid to us, please inform the
fund when the work relates to the fabric of the building or benefit office of this charges increase. It is your respons-
surrounding grounds. We maintain a sinking fund primarily ibility to ensure that your new charges are processed.
for two reasons: Please note that any other changes in your circumstances
(1) Ensure that all occupiers contribute to major works, not must be reported directly to the benefit office.
just those who are in occupation at the time they are
carried out, and
Why does my direct debit not reflect your
(2) Spread the annual charges to assist with your monthly charges, as on occasion I have found
budgeting. All reserve funds earn interest which benefit they disagree?
This may happen when you are making irregular payments,
All sinking funds are currently being reviewed against life which could be because your direct debit was cancelled or
cycle cost reviews for each block. The review will include set up at a later date than instructed due to banking
the level of monthly contributions, required balances for administration. This may result in your account falling into
each fund and interest rates for this type of Trustee bank arrears. After your accounts have been audited, your
account. This review is scheduled for completion and account may either be credited or debited.
results distributed by end of September 2011.
Where you have a debit, unless paid as a one off payment,
this irregular charge will affect your direct debit. Where
I am a freeholder, why do I still need to pay a you have a credit, unless you request a refund, this will
service charge & long term maintenance also affect your direct debit. Your direct debit payment will
charge? be adjusted to incorporate any arrears or prepayments and
spread over the remainder of the financial year, with effect
You may need to contribute towards a service charge and from the day your direct debit is set up. This can usually be
a long term maintenance charge if, for example, your resolved if you make a one-off payment to clear any
property is built on an un-adopted road, which is a road arrears by contacting your customer accounts manager.
that has been built as part of your development but isn’t
the responsibility of the local authority to maintain. As part
of the original planning permission, we have a
responsibility to look after the un-adopted road which could If you have any further questions
also include lighting columns. We collect a service charge about your rent and service charge review, call us on
for the communal service provided for the road. A long 0845 600 0830 (Mon-Fri, 8.30am-8.30pm and Sat,
term maintenance charge is collected for the reserve fund 8.30am-12.30pm), email rents&servicecharges@
for any future proposed works on the road. east-homes.co.uk or drop into our head office to speak
to a member of our team at 29-35, West Ham Lane,
Stratford E15 4PH (Mon-Fri, 8.30am-6.00pm).
Registered office: 29-35 West Ham Lane, Stratford, London E15 4PH. Customer contact centre: 0845 600 0830
Main number: 020 8522 2000. Minicom: 020 8522 2006. Fax: 020 8522 2001. Web: www.east-thames.co.uk
Registered in England & Wales (4091100) Registered Charity (1084952) Tenant Services Authority Registered (LH4309)
Member of the National Housing Federation