Frequently asked questions about property factoring

A property factor is an organisation appointed to manage the maintenance of property that is owned by more than one individual. The property factor will establish the cost that each person is responsible for, arrange the necessary repairs with a contractor and issue a bill to each owner for their share.

The property factors act came into force in October 2012. The act aims to protect homeowners by setting out minimum standards and regulating all property factors operating in Scotland. The act applies to all residential property and land managers in the private sector as well as local authorities and housing associations.

The act also set out a code of conduct which all property factors must comply with and introduced the First-tier Tribunal for Scotland (Housing and Property Chamber) to regulate the industry.

In order to comply with the act, East Ayrshire Council has registered all properties where it acts as property factor and issued a ‘Statement of Services’ to property owners who receive this service.

We are authorised to act as factor for blocks where: 

• the title deeds allow us to manage common repairs or act as factor while it continues to own at least one property within your block
• the majority of the owners in the block have appointed us to act as factor; or
• we act as factor for the block by ‘custom and practice’

Our statement of services is a document issued to each homeowner provided with our factoring service. It sets out the terms, conditions and service standards of the factoring agreement.

The Council is legally responsible for registering as a property factor with the Scottish Government and is obliged to carry out all work associated with its legal requirements.

The property factoring service will provide you with a 24 hour, 7 days a week service to report repairs required to the common parts of your property (for example the roof or guttering).

As factor, we will consult with owners regarding major works, undertake routine repairs and invoice all owners in accordance with their title deeds.

To cover the cost of providing this service, a management fee is payable to the Council. The fee will be reviewed annually and will reflect the cost of providing this service. This fee, together with the proportionate share of the costs of any grounds maintenance, common area lighting/cleaning and any other costs (if applicable) is invoiced quarterly in arrears in January, March, July and October. 

The Council has an obligation to pay the relevant proportion of communal repair costs associated with Council owned properties.

There are a number of administrative tasks that must be carried out to ensure that the factoring service operates effectively and efficiently, and that necessary common repairs are attended to including; inspections, processing correspondence beforehand, liaising and monitoring with contractors and preparation of the invoice afterwards.

The fee pays for the team who deliver the factoring service and carry out all of the associated tasks. By paying your factoring fee you are ensuring the service is able to respond to common repair issues affecting your block. Your factoring fee also covers other costs including; the fee paid to the Scottish Government for registering as a property factor, printing and postage of letters, invoices, newsletters and written statements, telephone/email advice and information as well as the cost of arranging site meetings.

Common repair charges

In addition to factoring and service charges, you are also due to pay a share of the cost of any common repairs, maintenance or authorised improvements to the common parts of the block.

The title deeds for a property will usually specify the arrangements for the management and maintenance of common parts, the procedure for making decisions and how costs are to be apportioned between owners. Where the title deeds do not make provision on specific points, the Tenements (Scotland) Act 2004 and the associated Tenement Management Scheme will apply.

Although it is not possible to generalise for all properties, owners will usually be responsible for an equal share of the cost of common repairs and maintenance of the common parts.  For example, owners in a block of six flats will usually each be liable for a 1/6th share of the cost of common repairs or maintenance works. The cost paid to our operatives/contractors to attend to a reported repair and carry out that repair is charged to all of the owners in the block in accordance with the title deeds.

The same applies to any visit made by the contractor where a full repair cannot be carried out. This includes visits to make safe, to do temporary repairs or, attending to carry out a repair but for some reason not able to do it.

Where a communal repair has previously been required, or requested by a private owner, the Council has always proactively ensured the repair is progressed. However, with the introduction of the Property Factors Act, there is now a legal obligation on us to formalise this position and ensure all owners are aware of our responsibilities as property factor.

If you sell your property, your solicitor should notify the property factoring team of the change as soon as you know who the new owner will be. We will then calculate any outstanding charges and send you or your solicitor a final account.