Some of our developments have a sinking fund in place. A sinking fund is for n fu for major repairs, renewals and replacements, and can help avoid the need to ask you to pay large one-off sums when major works are required. In addition, the sinking fund helps maintain the value of your home by setting aside the money for major repairs.
Where your lease requires us to set up a sinking fund, the money is ‘held in trust’ on behalf of the development in an interest-bearing bank account. This means we cannot use the fund for anything else other than major repairs for the development where it was collected.
How it works
Many of our developments have a sinking fund. All residents are obliged to pay into the sinking fund and you cannot opt out of paying it. Every year we will provide you with an audited set of service charge accounts which identifies all the payments made into the fund during the year, any money spent, plus the interest earned. We will provide a list of items and costs when money has been spent. The amount you pay into the sinking fund is dictated by the terms of your lease agreement. The lease states that Redwing Living has the decision and responsibility for how and when the sinking fund money is spent, but we will always consult with you when we are looking at using the sinking fund. Major repairs and replacements include:
• External doors, windows, roofs, guttering, walls, drains and plumbing.
• Door entry phone systems
• Communal carpets, electrical systems, TV aerials and lighting
• Communal footpaths, parking areas, fencing and signage.
How do I pay?
There are two ways to pay into the sinking fund:
• Pay as you go – money is collected on a monthly basis as part of your service charge. This is assessed on future anticipated costs of carrying our major repairs. This is reviewed annually and will change according to works.
• Pay on exit – an amount of money is paid to us when the property is sold. This amount is linked to the value of your property along with the number of years you have lived there, in accordance with the terms of your lease.
For more information on your sinking fund, you can contact your property manager by calling 0344 7360063.