Price or Value?

Nov 23, 2022 | 0 comments

With black Friday fast approaching and the current financial crisis many of us will be hitting the sales, but are the deals really as good as they seem.

There is a lot more data available now to suggest that the items on sale were cheaper within the previous 6 months than they had been on black Friday.

This has got us thinking about whether leaseholders are really getting true value for their service charges.

Whilst saving costs are pivotal for everyone during these challenging times we feel the most important factor when talking costs and agreeing budgets with our clients is having a strategic plan. This plan should include re-tendering out contracts to ensure best rates but also looking ahead and understanding the blocks needs and what is required during the forthcoming year.

We feel having these established relationships with our clients enables us to have these frank conversations and be open and honest about actual costs, but also being transparent with all contracts in situ.

At times service charge budgets may fluctuate, and in recent months we have seen increases in particular headings within the budgets. New fire safety regulations are coming into situ which means more annual reports are now required particularly for developments over 11m high. Electricity costs have also rocketed and whilst the government have provided some relief for business accounts (in which the landlords supply should be on) the increase is still astronomical compared to costs at the end of 2021. We are also seeing a lot of increases with insurance index linking against the declared value, which is having a knock on effect on buildings insurance for our developments.

The key thing for us is if there is a time where there needs to be some increases, that we are able to evidence these things to our clients and provide a full explanation.

We fully appreciate that everyone is always after the best deal and people may be drawn to lower prices, but the most important factor to us is getting the best price whilst also ensuring your asset is protected and maintained at a good level.

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