A service charge is what keeps an estate working after the developer has sold the last plot. Buyers tend to treat it as an annoyance, which it is not; the estates that hold their value are the ones that collect it and spend it well. What matters is knowing what you are paying for, how the figure is arrived at, and what happens if it rises.
Typically covered. Security — the gatehouse, personnel, and often lighting at the perimeter. Estate roads and drainage, which need clearing before the rains and repair after them. Common-area electricity, including street lighting and any shared pumps. Refuse collection. Landscaping and maintenance of green areas. Management costs, meaning the people who administer all of the above. Where an estate has a borehole and reticulated water, that appears here too.
Typically not covered. Anything inside your own boundary. Your electricity, your water consumption where it is metered, your building maintenance, your own security arrangements. Nor, usually, capital projects — a new borehole or a road rebuilt from the base is often a separate levy rather than part of the annual charge.
How it is calculated. Ask directly. Common bases are a flat charge per plot, a rate per square metre, or a share of a budgeted total. A per-square-metre basis means a larger plot pays more, which may or may not suit you. Ask whether undeveloped plots pay, and at what rate — some estates charge them less, which is fair while nothing is occupied and becomes contentious later.
Ask for the budget and the accounts. A well-run estate publishes a budget before the year and accounts after it. Ask to see both. An estate that cannot show you where last year's money went is telling you something about how this year's will be spent.
Ask how it changes. Whether increases require a residents' vote or are set by the managers, whether there is a cap, and what the charge has actually been for the last three years. That last figure is more informative than any assurance about the future.
Ask who manages it, and whether that is the developer, a separate facility manager, or a residents' association. Ask when control transfers to residents, because the point at which an estate stops being run by its developer is a real milestone and is often undocumented.
Ask what happens if people do not pay. Non-payment is the most common cause of estate decline. Ask what enforcement exists and whether it is used. An estate with no answer will eventually have no lighting.
Budget for it as an ongoing cost of ownership. For a plot you are not yet building on, service charge may be your only recurring outgoing, and it runs whether or not you have started. Include it in the figure you use to decide whether the purchase works, alongside ground rent and any land use charge that applies in your state.
For each of our estates, what the charge covers, how it is calculated and who manages it is set out on the estate page. If you are comparing us against another scheme, ask them the same questions.
Still deciding what to buy?
Tell us the size, the area and the budget. We will tell you what fits and what the documentation position is on each one.