Creating Our Budgets

Nov 10, 2021 | 0 comments

Head of property management Jasmine Davison-Holmes, and both property administrators Denika Cooper and Hayley Williams have started their budget preparation for 2022. But what goes in budget preparation?

What’s in the lease?

We start off by having a copy of the lease and the budget for the previous financial year. The lease should state what is to be covered under the freeholders covenants and the service charge. These items may include services such as window cleaning, and the frequency these services are to be completed.

 

Contractors

Assessing the contractors which are currently in situ at the block. Are they still good value for money? Are we happy with their work? Budget preparation is a fantastic opportunity for property managers to retender out contracts if they are no longer happy with the services being provided.

 

Site inspection

A site inspection is always recommended when completing budget tenders. This gives us the chance to pick up on any defects, any changes or improvements to the block, or check on contractors services.

 

Owners meeting

We also like to host a meeting with the leaseholders of the block. We believe this is a great opportunity to engage with the owners, voice our proposed plans for the next year, and listen to any improvements or updates they want to see.

 

Once we have all the information in front of us, it’s time to begin building the budget. It is important to understand that a budget is a property managers “best guess” on what finances will be required for the forthcoming year. It is highly unlikely they will get the budget exact to the penny, but this is where our experience and expertise in the field comes to play.

 

Block expenditure and quotes

We run a report which shows us the current expenditure of the block. This allows us to see clearly what headings in the service charge have the most expenditure, and what may require more funds in the future.

 

Finally, we ask for quotes from contractors to cover services for the next financial year. This insures that any inflation or updated services are being covered, and there are no nasty surprises and bills.

 

Our goal is to reduce the overall budget for the block where possible, whilst ensuring all services are being covered and are the best value for money.

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