Administration Charge - An amount payable to the landlord or manager by a leaseholder for a service provided exclusively in relation to their individual property.
Alternative Dispute Resolution (ADR) – Another term used for dispute resolution.
Appointment of a Manager – A right available to one or more leaseholders to make an application to a First-tier Tribunal for the appointment of a new manager.
Association of Residential Managing Agents (ARMA) - A trade association for residential managing agents in England and Wales formed to promote high standards of leasehold management and professionalism through advice, training and guidance.
Association of Retirement Housing Managers (ARHM) - A long-established trade body that represents both private sector and registered social landlords who manage retirement housing.
Budget – An estimate by the landlord or manager prior to the accounting year of the service charge payable in advance by the leaseholders.
Buildings Insurance - A contract provided by insurance companies, in return for regular payments, to cover the majority of risks relating to structural damage to property.
Commission – A payment received by a landlord or manager in return for placing the insurance, or any other contract, with that particular company.
Commonhold - A system of owning ‘freehold units’ within a building or block comprising separate properties and with all unit-owners having a joint responsibility for the common parts.
Commonhold and Leasehold Reform Act 2002 – legislation amending many provisions of previous Acts and most significantly introducing commonhold and Right To Manage.
Commonhold Association (CA) – A company limited by guarantee that is responsible for arranging or carrying out the management of the common parts of commonhold property.
Commonhold Community Statement (CCS) – A document that sets out the extent of the commonhold properties including the common parts, the rights and obligations of the CA and the unit-holders and other provisions similar to those in a lease.
Competent Landlord – The landlord with the authority to give consents, who must have an interest in the property of not less than 14 months.
Constitution – A document that sets out the objectives and rules relating to a Tenants’ Association.
Consultation – Either statutory or a less formal process of having regard to leaseholders’ views when a significant proposal is made relating to the management of property.
Contingency Fund – Another name for reserve fund.
Contractors – Individuals or companies who are employed by the landlord or manager to provide works or services to leasehold properties.
Conveyancing – The process of transferring legal title (ownership) of property.
Cyclical Maintenance Schedule (CMS) – A document that sets out predicted future works on the block, the year they are expected to be required and the estimated expenditure.
Deed Of Variation (DOV) – A document, agreed and signed by all parties to a lease that changes one or more of the terms of that lease and any other leases in common.
Defect – A fault arising to property that is due to factors such as poor design, faulty construction, inadequate supervision, shoddy workmanship or defective materials.
Deficit – The amount at the end of an accounting year where expenditure of managing the scheme excedes the income receivable by the landlord or manager.
Determination – The resolution of a case considered by a court or tribunal which is notified to the applicant and is usually, but not always a written decision.
Disability – Legally defined as a physical or mental impairment, which has a substantial and long-term (at least 12 months or more) adverse effect on a person’s ability to carry out normal day-to-day activities.
Disposal – The sale or transfer in the interest of a freehold property by a landlord.
Dispute - A complaint of a serious nature that has not been resolved at an early stage.
Dispute Resolution - An umbrella term for the different options for resolving a dispute between parties including mediation, conciliation, arbitration and facilitation which are viable alternatives to using a court or tribunal to reach a determination.
Dispute Resolution Committee (DRC) – An independent committee set up and operated by the LA to consider service charge disputes.
Elderly Accommodation Counsel (EAC) - A national charity that aims to help older people make informed choices about meeting their housing and care needs.
Federation of Private Residents’ Associations (FPRA) - A not-for-profit lease advice, support and lobbying organisation for private residential leaseholders, tenants’ and residents’ associations, Resident Management Companies and Flat Management Companies.
Forfeiture – A process whereby the landlord tries to recover possession of a leasehold property due to an alleged breach of the lease, usually in respect of non-payment.
First-tier Tribunal (Property Chamber) – A judicial body, which has replaced the Leasehold Valuation Tribunal in England, with the authority to determine a wide range of leasehold related issues or disputes.
Freeholder – The owner of the land or an individual property, such as a house, or of a block of flats who can be an individual, an organisation, or a company formed by the leaseholders.
Ground Rent – A rent payable under the terms of a lease by a leaseholder to a landlord.
Head Lease – A lease granted by the freeholder to a leaseholder, see ‘lease’ below.
Housing Association – The former term for registered providers of social housing which are not-for-profit organisations that develop, let and manage social housing.
Improvements – Works that result in something entirely new or something that ends up in better condition than it was originally, as opposed to a repair or refurbishment.
Landlord – The party, who may be the freeholder, who grants a lease on a property.
Landlord and Tenant Act(s) (LTA) – A wide range of legislation over a long period of time regarding the rights and responsibilities of landlords and leaseholders (tenants).
Land Registry – A Government department that registers and records details of land and property in England and Wales.
Lease – A legally binding contract between parties, typically a freeholder and a leaseholder, which transfers possession of property for an agreed fixed period of time.
Lease Extension - A contract that adds a continuation period to a long-lease, which is a lease that was originally granted for a period longer than 21 years.
Leasehold (long-lease) – A system of tenure whereby the landlord gives possession of a property or part of a property for a fixed period longer than 21 years.
Leaseholder – The holder of a long-lease on a property, often referred to as a tenant.
The Leaseholder Association (LA) – A not-for profit organisation who provide on-going support, advice and speedy alternative solutions for conflict resolution to prospective and current leasehold owners.
Leaseholders’ Handbook – A document supplied to the purchasers of leasehold property which summarises the lease and provides other information.
Leasehold Reform Housing and Urban Development Act (LRHUDA) 1993 – Legislation primarily to introduce new rights for collective freehold purchase and lease extension.
Life-lease – A contractual possession arrangement that gives someone exclusive occupation of a property for their entire life, usually with no right to transfer this interest.
Manager – The party responsible for carrying out the management functions as specified in the lease, often referred to as a management company or managing agent.
Management Audit – A process whereby leaseholders can appoint a qualified surveyor or accountant to scrutinise all the management functions carried out by the landlord.
Management Fees – A fee charged by the landlord or manager in return for managing the leasehold property.
Management Company – A term used for the company or organisation responsible for the management of the property or estate. Which may be a private company or a housing association, appointed to carry out the management duties on behalf of the landlord (sometimes referred to as a managing agent), or a Resident Management Company or Right to Manage Company
Marriage Value – The additional value of the leasehold and freehold interests being combined during the process of enfranchisement and lease extension.
Memorandum and Articles of Association – Documents that set out the objectives and regulate the activities of a company.
National House Building Council (NHBC) - An independent standard-setting body and provider of warranty and insurance for new homes whose role is to work with the house-building industry to raise the standards of new homes and to provide consumer protection for homebuyers.
Professional Fees - The costs incurred by a landlord or manager in engaging professionals for the supervision of major works or additional services that are of a specialist nature.
Qualifying Tenants – A term that may include long-leaseholders and other categories of tenants who have rights under specific legislation.
Repairs - Rectifying damage or deterioration to property by restoring something to its previously good condition.
Registered Social Housing Providers – A relatively new term for ‘Housing Associations’.
Reserve Fund - A fund held in trust by the landlord or manager, on behalf of the leaseholders, which is set aside, and represented in cash, to cover the cost of major works or other significant items of future expenditure. Also known as a sinking fund.
Reserves – The total amount of leaseholders’ funds, including any monies owed, as shown on a balance sheet at the end of the accounting period.
Resident Freehold Company – A company formed by a group of leaseholders to collectively purchase the freehold (enfranchise).
Resident Management Company (RMC) – A company formed collectively by residents, with the consent of the landlord, that has the responsibility for the management of the property.
Residents’ Association – Another term used for a Tenants’ Association however, it can also have a wider meaning of an organisation representing residents of all tenures in a large estate or even an entire local area.
Right of First Refusal - An opportunity for leaseholders, and some regulated tenants, to collectively purchase the freehold interest in the property they occupy at the same price and terms as the landlord would sell it to another party.
Right To Manage (RTM) - The statutory right for a group of leaseholders to collectively take over the management of their block of flats without having to prove fault and without having to pay any compensation to the freeholder or the existing manager.
Right To Manage Company (RTMC) – A company formed by leaseholders to exercise the RTM.
Royal Institution of Chartered Surveyors (RICS) - A leading professional body for qualifications and standards in land, property and construction.
Scheme Manager – An employee of the landlord or manager who manages the estate. There are two types of scheme manager, a resident scheme manager who lives on-site and provides a high level of support to the residents and a visiting scheme manager who lives off-site and provides limited support.
Section 20 – A legal right introduced by the Landlord and Tenant Act 1985 which requires landlords or their appointed manager to follow a prescribed consultation procedure when the expenditure on works to the property exceeds £250 in respect of at least one flat.
Service Charge - An amount payable by a leaseholder/tenant, in addition to any ground rent, for services, repairs, maintenance, improvements, or insurance, or the cost of management the whole or part of which may vary, from year to year, according to the costs incurred.
Shared Ownership – A process that allows the buyer to buy a proportion of the interest in the property whilst the landlord, which is usually a housing association, retains the remainder.
Short-hold Tenancy – A relatively short-term tenancy that can be granted on a property where the tenant has exclusive possession.
Sinking Fund – A fund held in trust by the landlord or manager, on behalf of the leaseholders, which is set aside, and represented in cash, to cover the cost of major works or other significant items of future expenditure. Also known as a reserve fund.
Stamp Duty Land Tax - A Government tax payable as a percentage of the sale price on any sale of property that exceeds £125,000.
Sub-letting – A process whereby a leaseholder grants a tenancy to a third party, which is usually a short-hold tenancy.
Surplus – Any amount at the end of an accounting year which arises due to the actual expenditure of managing the scheme being less than the income receivable by the landlord or manager.
Tenants’ Association – A formerly recognised association of leaseholders, with legal rights, who contribute towards the same service charge.
Tenure – The conditions or method by which land or property is held, which in England and Wales includes, freehold, long-leasehold, commonhold and letting.
Term - A period of time the lease has to run or an obligation or right specified in the lease.
Transfer Fees – A payment to a landlord on each occasion a property is sold or a lease is transferred which is usually regarded as a premium for which no services are provided in return.
Tripartite Lease – A lease that has three parties, which means in addition to a landlord and a leaseholder, Managing Agents might be a party to the lease.
Under Lease – A legally binding contract granted by a leaseholder to another party, which transfers possession of property for an agreed fixed period of time, usually for the same period as the leaseholder’s head lease.
Upper Tribunal (Lands Chamber) – Part of the justice system that handles appeals made in respect of decisions made by the First-tier Tribunal.
Ref: 100/3/15 ©Copyright
