Choosing the right block management company to look after your rental property apartments or flats is vital. A professional company will bring an organised approach to the planning and collection of the service charges, the scheduling of repairs and refurbishments, and the supervision of that work. Their know-how and experience will help to maximise your returns.
The benefits of using a block management company are manifold and include the following services:
· They collect funds and are responsible for taking the necessary steps to recover any unpaid rent, service fees and ground charges.
· They can deal with issues and disputes in an impartial manner and help limit any animosity or disagreements that may rear their heads.
· They will take over all the administration duties of your block and have the facilities in place for storage and retrieval of records and documents that are required for annual accounting purposes.
· They distinguish between the needs and duties of the company under the Companies Act, and the needs and duties of the company in its role as a landlord as required by current legislation.
· They carry fidelity insurance to protect client funds. This is an advantage over self-regulation of funds by individual members.
· They hold professional indemnity cover to protect against incompetence or negligence.
· They accept some of the responsibility for compliance with laws, leases, and codes of practice. However, you are still responsible for setting policy and monitoring the work of the management company.
So, what should you do to ensure you’re choosing the best block management company?
What are their qualifications?
Check to see if the company you’re hoping to use is independently licensed – their website should show if they belong to any industry associations like the Association of Rental Letting Agents (ARMA), or the Royal Institution of Chartered Surveyors (RICS). This is particularly important as the management and administration of apartment blocks or flats is complex and requires specialist legal knowledge.
Meet informally first
It’s a good idea to meet with a few management companies first, before requesting a formal tender. Here, you can sit down and talk to their team and mention any problems that need to be tackled, or major refurbishments that may need to be undertaken. Any good management company will want to ask you questions too, so they know exactly what they’re taking on.
Do they have a proven track record?
Make sure that managing properties is not just a small part of what they do; you want to be reassured that property management is their core business. It’s important to establish that they have a proven track record in this specialised field – professional companies like South East Leasehold that have 30 years in the industry, are one such company. You might also like to speak to directors in other blocks administered by the management company to obtain testimonials and references.
Check for customer service
A management company is the vital link between you and your tenants and must therefore deliver exceptional service at all times. They need to be helpful, readily available, highly proficient and quick to resolve issues. Monitor how long it takes a prospective block management company to return your call, or come back to you with answers to questions you’ve raised. If they respond swiftly and provide you with knowledgeable answers, then you can probably trust them with your business.
How flexible are they?
Does the block management company have a flexible approach? You may wish to choose which parts of the administration and/or management you’d like them to handle. Are they comfortable with this? They may take an ‘all or nothing’ approach and appear rigid, in which case they may not be the right company for you.
How much do they charge?
Don’t be embarrassed to ask for an exact breakdown of a management company’s fees. Depending on your service requirements, their costs may be negotiable in certain areas.
Important questions to ask
Before you make a decision, check that you’ve obtained satisfactory answers to important questions such as
· Who will be the contact person at the management company, and can you meet them? Ask what happens if that person is away on holiday or sick.
· Who will handle phone calls and emails and carry out the day-to-day administration?
· Who chooses which contractors are used for your block? Do you have any say in this?
· How often will you receive copies of the service charge income and expenditure reports. Will these reports be accompanied by invoices and receipts?
After you’ve asked two or three companies to tender and have finally decided which company is for you, contracts need to be drawn up and signed. Both RICS and ARMA have management contracts/agreements templates in place, and can let you have copies of these.