The myth of the maintenance free building.
In the course of our consultancy work with residential managing agents we frequently come across the need to deal with cyclical maintenance work (often required as a Landlords’ obligation under the terms of the lease terms), or sometimes to investigate specific defects within even relatively new blocks.
In the course of this work it frequently comes as a shock to resident management company (RMC) directors that there is a need to carry out any work at all to the building, because all too often they, like other leaseholders, have bought flats on the promise of low service charges, full NHBC insurance (to cover any defects) and the promise of a maintenance free building. Sadly that is rarely the case.
The entire building structure whether it be the roof, plastic windows, carpets or communal lighting, all gradually deteriorate over time, meaning they need occasional maintenance, repair and ultimately renewal. Just because a building does not have painted wooden windows and old slate roofs does not mean it can be considered maintenance free.
Throughout the life of the building various factors cause it to deteriorate.
Weathering – Obviously the effects of wind, rain, snow and frost mean that the surfaces of tiles, slates, brickwork and render gradually become worn.
Occupation – Items such as internal carpets or other floor coverings, communal decorations, internal doors and the like, get used every day and become soiled, chipped and worn.
Statutory Regulations and Legislation – We live in an increasingly regulated world and there are updates or changes in legislation which sometimes mean alterations or improvements have to be made to buildings, such as electrical installations, fire safety equipment, communal heating, etc.
Defects – Sometimes even new buildings have defects in them. Sometimes they have not been constructed as well as they should have been, or they have poor quality components incorporated in them, giving rise to water penetration, cracking or other defects. Sadly, contrary to many peoples’ expectations new building guarantees (such as the NHBC) do not necessarily cover all these items and the claims procedure can be slow, complex and expensive.
Strong recommendation
My strong recommendation is that directors of RMCs work closely with their managing agents to make sensible (although not excessive) provision for some of these factors, so that there is the financial means to deal with issues when they arise.
These need not necessarily cost a lot of money although it can sometimes be difficult convincing lessees that it is sensible to set money aside for expenditure in future years, when they anticipate that by then they may have sold and be gone. Over the years we have acted for many lessees who are the unfortunate ones left when this high risk game of “parcel-the-parcel” comes to an end and they are holding an extremely expensive problem when the music finally stops.
There is a considerable amount of study on life-cycle costings within the building and surveying industries that goes beyond the parameters of this short article but we set out below a few very approximate indications of life span for certain common elements of the building and the effects on service charge.
Case Study
During a recent inspection we looked at a property in the Midlands of some 120 flats. They are of very typical modern construction comprising a series of framed buildings with brick and rendered cladding externally. The flats were fitted with uPVC windows. The roofs were tiled and the common parts simply finished with painted plaster walls and carpeted floors. One larger block contained a lift.
The residents were currently paying a service charge, which after regular costs deducted allowed only around £70 per unit to be added each year to a reserve fund, meaning that costs of only £8,400 were being collected each year. Whilst this might sound satisfactory, consider the brief illustration below (with approximated costs) to view the sort of effect major refurbishment / replacement costs can have over a longer time period.
| Building Estimate Life Span (years) | Estimated Replacements/Refurbishment Cost (£) | Amount required £ (pa to accumulate replacement cost) | |
| External | |||
| Tiled Roofs | 60 | £175,000 | £2,917 |
| External Brickwork | 100 | £175,000 | £1,750 |
| External Render | 20 | £ 40,000 | £2,000 |
| New uPVC Windows | 30 | £ 60,000 | £2,000 |
| Internal | |||
| Decorations | 10 | £ 21,000 | £2,100 |
| Carpets | 10 | £ 17,500 | £1,750 |
| Electrical Services | 25 | £ 70,000 | £2,800 |
| Fire Safety Services | 15 | £ 35,000 | £2,333 |
| Lift | 30 | £40,000 | £1,333 |
| Total Amount required p.a. | £18,983 | ||
| Total Amount required p.a. per flat | £ 158 |
Langley Byers Bennett regularly advise managing agents in a wide variety of Building Surveying matters including Service Charge disputes, defect diagnosis and building works.
