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Friday 28 June 2019

Popular methods of calculating Maintenance charges of flats in housing society

There are three ways in which each housing society can decide the service charges for each flat members. The society is free to choose the design that suits their respective needs. The three popular methods used to calculate maintenance charges are Flat wise calculation,Area wise calculation & Mixed or Hybrid Method.

Flat Wise Calculation
Flat wise service charge module first calculates total expenses of society,and divides equally to all flats irrespective of the size of the flat.This method should be implement where each flat is of the same size.This method brings a fairness to each flat member.

Area Wise Calculation
This methods we calculate maintenance area wise, the total costs incurred by the society are charged according to the area in terms of per square feet owned by each member. The common areas are divided equally using a fixed rate while flats are calculated depending on the size of the apartment. For example, If  rate is Rs. 2/sqt then for 1000 sqft flats it is Rs 2000/per month and for 1500 sqft flat it is Rs 3000/per month.

Mixed or Hybrid Method
If housing society is large and flats area are different like 1 RK,1 BHK,2 BHK,3 BHK then in order to be fair service charges on the flat owners, hybrid method should be implemented in societies. The method involves splitting the charges into two part as following :
1.All the common expenses incurred on Lift Repairs & AMC, security/watchman salary,Housekeeping Staff, Printing & Stationery, property taxes, conveyance, audit fees, meeting expense, electricity charges,Insurance Charges etc.
2.The second part includes the area based charges that are specific to the apartments such as Major Repair Fund,Sinking Fund, water charge and electricity usage.