In the second part of our interview with our block management franchise experts, Duncan Foster, business development manager and Chris Summers, head of franchising, they discuss what they expect to see happen in the sector in 2020 and how change in legislation should improve the industry in the years to come.  

There’s a lot of criticism around leaseholds, especially block management companies in terms of unexpected charges and poor upkeep. How has SDL Property Partners tackled this issue and how can it be improved going forwards?

Duncan: The industry has been crying out for improved customer service for some time. It’s not to say they’re aren’t block management businesses who have got it right, but as an industry there is a lot of room for improvement. The changes in legislation and regulation should go a long way to helping raise the standards across the board but it’s our responsibilities as businesses in the industry to do better. We have to see residents as customers; after all we are providing a service.

I think service charges in particular are a little bit of a taboo – I don’t think residents have many good things to say about them. But I don’t think that’s because service charges in themselves are a bad thing, I just don’t think their purpose and how they are spent are always communicated well.

Some people think that a service charge is dead money, they don’t see the return on what they are paying for. Actually a service charge is helping to protect the value of their asset (property), yet I’d be very surprised if many block management businesses have sat down and really explained it to residents. Improved customer service would help to communicate this.

Chris: By taking away the back office and compliance, it allows our partners to focus on their number one priority, customer service. When we first speak with prospective partners we ensure that their vision aligns with ours. Providing an amazing service has to be one of their core values, just like it’s one of ours. So, we find in the main with our partners it comes naturally but we still encourage them to have a positive mindset about delivering an outstanding service to residents – making residents the centre of their business.

Duncan mentioned the changes in legislation, with a big mix up in the next few years, what do you expect to see change and what do you think needs to change?

Duncan: Touching again on customer service, we need more people in the industry to be visible to residents. I think many block management businesses don’t make an effort to actually meet and speak with residents when they make site visits. Someone who is there to meet and speak with residents makes the service personal and can go a long way to ensuring little issues don’t become big ones. Residents who know and trust their block managers are much more likely to be happy residents.

Chris: I think that the sector will become more qualified. A lot of talk around the new legislation is that it will mean people working in letting agents, at surveyors, in block management, will need qualifications to work in certain roles to gain a deeper understanding of the market and resident’s needs. It means better overall knowledge of how to manage a property effectively. This should help to raise standards in the industry.

What are your predictions for block management in 2020?

Duncan: Next year I expect to see more traction with letting agents and surveyors. With the tenant fee ban, smaller agencies have to find additional income streams and block management is one way to do that. Franchise block management in particular means letting agents no longer have to avoid the market because of the worry of back office jobs.

Chris: I agree, I think franchising will grow, as more people want to go it alone. I think we will also see other people in the industry who have a passion for property move into block management. Their background could be in construction or risk and loss management, whatever it may be they already have the appetite to work in property and I think they will see the benefits of block management.

Talk to the team

If you’re thinking about expanding or going into block management and would like to know more about how becoming an SDL Property Partner can help you, give the team a call on 0345 521 01527.