Everyone knows that when you buy an apartment or even a few specific housing scheme developments, there is usually a quarterly annual payment made to the managing agents or freeholders.
This payment is known as a property service charge and often will go towards the maintenance of communal areas or for instance; landscaped gardens, lift maintenance, communal lighting, rubbish collection and sometimes towards the porter or concierge desk.
As London aims to keep up to date with other international cities and the expectation and demand one sees abroad, (i.e. New York, Dubai, Singapore or Hong Kong) developers are having to offer more and above the standard items listed above.
Converted properties in the typical Victorian or Edwardian flats often have the cheapest service charges. Mansion flats are generally higher as there are lifts and require regular painting of internal and external areas. New Build schemes provide even more tangible useable benefits and amenities.
Service charges in these buildings can range from £5 per sq. ft. up to £20 per sq. ft. although many central London blocks like; One Blackfriars, Rathbone Place and Centre Point will range from around the £7.50 to 9.50 per sq. ft. – Whilst schemes like One Hyde Park, The Bulgari Apartments, The Lancaster’s or Academy Gardens can range from £15 to £20+ per sq. ft.
These schemes feature some highly unique and almost ‘hotel-like’ amenities, spas, gyms, swimming pools, libraries, business lounges, resident’s lounges, wine-tasting rooms, whisky and cigar humidor rooms, yoga studios, treatment rooms, cinemas, bike storage, recycling centres etc. The concierge desk can offer services from arranging laundry and dry-cleaning, 24/7 security, recommending night life hot spots or making restaurant reservations.
Over the past few years I have noticed how service charges in new apartment blocks in London have risen sharply. It is important to remember that all the above will have to be paid by the resident and although this can seem tempting at first, costs can soon escalate.
How do property service charges vary across London?
From my experience, property service charge will differ in all areas of London. This is because it all depends on the development.
For example, Shoreditch or Southbank are not super prime areas but still have high-value schemes like; Southbank Place, Southbank Tower, One Tower Bridge, One Blackfriars, NEO Bankside etc.
More than just a cost
In central London, I have often worked for clients whose primary goal is to find security and concierge services; as well as day to day amenities for instance; a swimming pool, spa facilities, wine cellar, residents and business lounge, meeting rooms and a gym.
However, what you should know is that service charges are often a hidden cost, which should be factored in when considering the affordability of a property. In some cases, service charges are uncapped and if not checked can increase quite rapidly as developers or moving agents often realise the initial service charges calculated at point of sale are often not high enough to deliver the day to day outgoing required to maintain the services expected in each development.
If you would like to find out how Garrington can find you the perfect property with any surprises on service charges please get in touch today.