Resources for managers and leasehold owners.

Information is the missing link in our world. So many issues would be alleviated were we all up to speed with current legislation, regulation, the snappily titled First-Tier Tribunal (Property Chamber) (FTT(PC)) and the overwhelming amount of knowledge needed to understand leases, budgets, accounts, consultation process and the myriad other areas involved in running residential blocks.

Suffice to say there are  few of us who can claim to have a handle on all of it. Not me.

So here is a list of great places to keep in your bookmarks and to review whenever you have a spare moment:

• ARMA  http://www.arma.org.uk - a brilliant source of guidance with over 300 notes for members and much more besides. Even non-members and leaseholders are well served by the freely available documentation and there is so much more if you join.
• Leasehold Advisory Service  http://www.lease-advice.org - again a fantastic source of well written and clear advice as well as case updates.
• IRPM  http://www.irpm.org.uk - great resource for members in particular and growing source of quality analysis
• FPRA http://www.fpra.org.uk/ The Federation of Private Residents' Associations is a not for profit organisation dedicated to supporting leaseholders and lobbying on their behalf. An excellent resource for residents' groups it should also be followed by conscientious managers.
• ALEP http://www.alep.org.uk/ everything you could ever want to know about enfanchisement.

• SLC Solicitors - http://www.slcsolicitors.com/ have an excellent section on their website entitled 'Guides'
• Brady Solicitors - http://bradysolicitors.com/ likewise
• Brethertons - http://www.brethertons.co.uk/

• www.lawandlease.co.uk/  Amanda Gourlay's (of Tanfield Chambers) eloquent dissection of all the latest case news and, for my money, the best sector analysis out there. If you have any involvement in this sector you have to keep this one bookmarked and visit regularly.
• http://leaseholdlawyer.wordpress.com/ - Chris Alexander's blog is also an excellent source of comment.
• http://www.leaseholdlife.info
• www.leaseholdknowledge.com/
• www.leaseholdinfo.com/
• The Residential Manager https://davidclark'sblogspot.co.uk  - In all honesty this one is rubbish.

• News on the Block - http://www.newsontheblock.com/ growing web resource
• FlatLiving - http://www.flat-living.co.uk/ similarly a growing resource
• Property Week - http://www.propertyweek.com/ the old favourite and a little more engaged with the residential sector than Estates Gazette in my opinion.

Is your managing agent solvent?

 There will soon be a perfect storm that includes the CMA (OFT) report into residential leasehold management, ARMA Q going live, increased competition and ongoing consumer pressure that will lead to many small to medium managing agents throwing in the towel once and for all. Some will find sale or merger opportunities, some will simply shut up shop and one or two, possibly, will run off with your money. It's coming, I promise.

Sounds dramatic, but I have researched my case well. I have looked at many  managing agents  financials (more than 30) in detail over the last month and I have spoken to many. Balance sheets and histories are freely available on sites like Duedil and they tell a sorry story for some, well quite a lot actually. Reduced turnovers, negative balance sheets, tiny net worth, squeezed profits, senior staff leaving or worse.

For me it is the financial history of many firms that is most telling where, despite what we are being told, turnovers are static and profits are being squeezed by growing wage demands and increased and often justified client and customer requirements for visible value for money.

Those that are succeeding have two things in common; they have scale and they offer a wider range of integrated services. Whether as estate agents, facilities managers or general practice surveyors, you need a broader slice of the delivery cake to make residential leasehold management work as a business proposition. Self delivery of health and safety compliance, surveying, soft services such as cleaning and concierge and debt collection all make businesses more stable and embedded. Look to the commercial facilities management industry for a potted history.

Those promising different levels of service, new standards of response, less units per manager, etc.etc. are still having to deliver at the same or at lower price per unit. We are in a period of unprecedented competition and that is driving service standards and pricing. This is a good thing but inevitably it will shake out the weakest, good or bad.

I get asked a lot by leaseholders what they should look for when deciding on an agent. There are the obvious things that all guides will give you but they rarely mention the financial aspects. So here are my easy steps to ensure that you, as a freeholder, a director of an RMC/RTM company or simply as a leaseholder need to do, in addition to the obvious things, to ensure you are protected:

1. Have a look at your managing agents financial history. Use one of the freely available web services which will give you much of the information you need like turnover, profits, balance sheets, ratios and ownership. Buy the last accounts - usually no more than a few £s.
2. Take into account the size of the business and the number of staff relative to the service promises being made. Are you happy that turnover and profit is sufficient for the type of business.
3. Are they trading solvently? Are they improving their numbers year on year? Do they have the scale to survive a major loss of business such as a big instruction?
4. Is their client base varied and broad?
5. Is your money properly protected and held in trust in a separately identifiable account?
6. Are they ARMA Q accredited or working towards it. If not, why not? (Being a member of RICS does not cut it as a substitute for Q- they may well audit periodically but they will not be looking for the same signs.) If they imply that cost is prohibitive then that in itself tells you something important. Regulation should not be optional.
7. Ask about the plan for the business, succession, retirements, sale etc.

Remember it doesn't matter how good your agent is, how solid their reputation is, if they are unable to trade at a profit or to meet their commitments. Add this to the list of essentials when looking for a new one...