Service Charge Forecast Calculator
Project a service charge forward at an assumed inflation rate, with any major works levy, to see the total cost over your ownership.
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Buyers check the current service charge and stop there. It is a recurring cost that rises, frequently faster than general inflation because building maintenance, insurance and energy have all risen sharply, and over a decade of ownership the total is a substantial number.
Major works are the other half. A roof, lift replacement or facade repair arrives as a one-off levy that can dwarf several years of ordinary charges, and it is nearly always known about long before it is billed.
The calculation
Each year charge is the current one compounded at the assumed increase, and the total is the sum across your ownership. Any major works levy is added separately because it is a one-off rather than part of the recurring charge.
Worked example
A 2,400 annual service charge rising 6% a year reaches 4,055 by year ten, and the ten-year total is 31,634. Adding an 8,000 major works levy brings it to 39,634 — an average of 330 a month across the decade, against a headline charge of 200.
Ask for the reserve fund position
A building with a healthy sinking fund spreads major works across years of contributions; one without it bills owners in a lump when the roof fails. Ask for the reserve fund balance, the last three years of accounts, and any consultation notices already issued before you buy.
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Create your free property pageFrequently asked questions
Why do service charges rise faster than inflation?
Because they are weighted toward building insurance, energy and specialist maintenance, all of which have risen faster than the general basket. Ageing buildings also need progressively more work as systems reach end of life.
What is a sinking fund?
A reserve built from annual contributions to pay for major works when they arrive, so owners are not billed a lump sum. A building with a well-funded reserve is materially lower risk, and the balance is worth asking about before buying.
Can I be billed for works decided before I bought?
Frequently yes, if the liability falls on whoever owns at the billing date. This is why consultation notices already issued are a standard pre-purchase enquiry — a levy agreed before completion can land on you afterwards.
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