The service charge you pay is split between the day-to-day services that keep the building and communal areas clean and tidy and in good repair, and the sinking fund is used for maintenance items that arise less often than once a year.
Your lease requires you to contribute to the sinking fund in order to build up reserves for the long-term maintenance of the building. If you sell your property, the contributions you have made cannot be refunded to you. The sinking fund will, however, be an asset that will attract buyers and/or secure a better price for your property.
If your lease did not say that you must make contributions to the sinking fund, you would have to find large lump sums each time major repairs or redecorations were needed.
If you are a shared owner of your property you will pay rent and a service charge. If you own all of your property and it is a flat you will no longer pay rent, but you will still have to pay a service charge for maintenance of the communal areas. If you own all of your property and it is a house you may own the freehold, but will still be required to pay a service charge if there are communal areas such as a shared garden, or shared parking areas.
Day-to-Day Services met from the Service Charge
These include:
- Cleaning of the communal hallways and staircases if you live in a block of flats.
- Maintenance of communal gardens and courtyards.
- Electricity costs for lighting of the communal areas.
- Day-to-day repairs to the communal parts and structure of the building.
- Communal water supply charges.
- Buildings and public liability insurance.
Sinking Fund
This is a savings fund used to build up reserves for the planned maintenance of the building, such as:
- External decoration.
- Decoration of the communal halls and stairways if you live in a block of flats.
- Roof renewal.
- Replacement of gutters and downpipes.
- Window replacement.
- Renewal of entryphones, lifts or shared TV aerials.
Money for the sinking fund is accounted for separately and interest is added. The service charge audited accounts that we send to you each year (in August/September) give details of the sinking fund, including the amount in the fund, how much we have collected, interest that has been added and the amount spent during the year.
Changes to Your Rent and Service Charge
Your rent and service charge will be reviewed once a year, and any increases or changes will take effect from the beginning of April each year. We will give you written notice of changes. Your lease gives information on how any increase to the rent is calculated.
The Service Charge Budget will be set in February each year based on the anticipated expenditure for the coming financial year. As soon as possible after the end of the current financial year, we will finalise the service charge accounts and have them checked by an independent auditor. You will be sent a copy of the account.
You can also read the full Service Charge Policy.
Frequently Asked Questions
A service charge is an amount residents pay to cover the cost of providing communal or shared services to a building and, if applicable, the surrounding estate.
Under the terms of your agreement, you must contribute towards the costs incurred by Hexagon for any services or works to the building your home is in and the grounds or estate around it. You do this by paying service charges. How much you pay depends on the services you receive. We are committed to providing all our residents with value for money and a good quality service.
Each April, we will send you a notice for the estimated day to day service charge for the forthcoming year. The estimated service charge is how much you need to pay towards the total estimated cost of managing and maintaining your block building and the estate and the charge is dependent on the size, location, and age of the building. You can pay the demand in instalments if you wish. The block buildings and estates we own and manage are all different, so too are the amounts that residents in different buildings are charged and as a resident () you are liable to pay towards the service charges.
Where your property is a home within a block/estate, you will be required to pay a share of the overall charge for the block/estate and the Freehold Charge, which covers the scheme charges such as communal gardening & estate management costs. Alternatively, you can contact us to set up an agreed instalment plan.
In September each year we will send you an adjustment for the previous financial year. For example, in September 2024, we sent you notification of the 2023-24 actual adjustments for the estimated service charge period you were notified of in April 2023. If your estimated service charge was too low or too high, we will advise you of the debit/deficit or credit/surplus amount and put it on your service charge account for the financial year 2025-26. MyHexagon allows homeowners to view/manage their service charge account online. You can obtain a detailed breakdown of each actual adjustment as well as make payments and update your details. To find out more and register go to the ‘MyHexagon’ link on our website.
The income from rents and service charges is essential for us to continue to provide the services we are required to provide to you. This income pays to keep your homes safe, covers cleaning and grounds maintenance and the costs of managing your home (e.g., collecting rent, dealing with anti-social behaviour, and providing support to vulnerable residents to enable them to stay in their home). It is also the income that allows us to borrow to build new homes which are so desperately needed.
Estimated costs, including inflation and the costs charged by our contractors are divided by:
- those customers who receive the service or
- the number of properties in each block
The percentage you contribute is calculated according to the terms of your lease agreement. Costs are divided (or ‘apportioned’) among homes based on the cost of maintaining the block & estate of your property.
Service charges for tenants are fixed, all tenants pay the same charge regardless of the level of service they receive. Homeowners pay a variable service charge dependent on the level and cost of the service provided. This is a requirement of your lease.
We recognise that many residents may be facing financial pressures at the moment, but we have a range of assistance available to support you. If you are struggling to pay your rent & service charge, please call us on 020 8778 6699 to find out what support is available to you.
What can be included in service charges?
The cost of cleaning different areas in and around your property. A checklist, listing all the specific tasks and frequency of visits, has been placed on your noticeboard or is being sent to you.
The cost of maintaining the communal grounds, including car parks. A checklist, listing all the specific tasks and frequency of visits, has been placed on your noticeboard or is being sent to you.
We remove bulk rubbish, external fly-tipping or dumped furniture and white goods. We also remove any items left in communal areas as they pose a fire risk, and we will charge you for this.
To reduce future service charge costs, you are encouraged to dispose of rubbish responsibly and to keep communal areas clear of items.
Cleaning of the communal windows of the building your property forms a part of. Also, if you live in a block of flats where it is difficult to clean windows to individual flats then this service is provided by Hexagon and this cost is also recovered.
The cost of providing and repairing CCTV in your building and/or development/estate.
Supply of electricity to all communal electrical installations e.g., lights, lifts, door entry systems.
Supply of water to all communal facilities e.g., cleaning cupboards, external taps, as well as the removal of any wastewater.
The provision of signs within your building and/or development/estate.
The statutory servicing of the Automatic Opening Vent (AOV). This controls the ventilation of smoke in the event of a fire.
Servicing, maintenance, and repair of automatic car parking gates.
Servicing, maintenance, and repairs for the water pumps in your building and/or development/estate.
Servicing, maintenance, and repair of any communal door entry system.
The statutory servicing and inspection of communal fire alarm systems, emergency lighting, communal smoke detectors and fire equipment.
Servicing, maintenance, and repairs to the lift/s in your building.
The costs of providing phone and/or broadband lines for communal systems such as lifts, door entry and other access control systems etc.
Maintenance and repairs to the communal television aerial in your building and/or development/estate.
Servicing, maintenance, and repairs for the water booster pumps in your building and/or development/estate.
In the case of communal closed water systems there are periodic legionella tests carried out in addition to risk assessments of water supplies and regular maintenance flushing of water systems.
The maintenance and repairs to the communal areas and structure of the building that your property forms a part of and/or development/estate.
Replacement of lightbulbs in your building and/or development/estate.
The removal and/or the prevention of pests from communal areas of the building or development/estate.
Works carried out to trees somewhere within your communal area. Some of this is planned works following a survey to determine if a tree is or could be a hazard.
Replacement floor coverings in your building.
The cost of carrying out decorations to external and internal communal areas of the building that your property forms a part of and/or development/estate.
