Scotland property factors – FAQ’s
Property Factors – Frequently Answered Questions
What is a property Factor?
Put simply, a property factors role is to manage and maintain all common areas of land and property owned by more than one homeowner. This includes stairwells, hallways, and lifts as well as the actual grounds and gardens of a property.
A factor can operate as a private business or a registered social landlord. In some cases, like local authority housing, the council acts as the factor for the properties it owns. While it’s not necessary to have a property factor to look after communal property – it does make things a lot easier.
When it comes to regular maintenance, cleaning, and upkeep – having someone coordinate the work and keep all homeowners up to date can save a lot of hassle and avoid potential disagreements.
What is the history of Factors?
The history of factoring can be summed up in this extract from the Final Report of the Glasgow Factoring Commission, 2014.
“Factoring of residential properties in Scotland emerged from the tenement building boom of the late 19th and early 20th Centuries, and was especially significant in Glasgow, where landlords built and owned whole tenements. The factor was the landlord’s agent with authority to collect rents and manage tenancies. Private renting as a tenure went into severe decline from the middle of the 20th century with much of the original tenement stock converting to owner occupation. At the same time, a large proportion of the city’s population moved to new Glasgow Corporation housing, and to the emerging owner-occupied market beyond the city boundaries.
The principal role of the property factor in the tenement and other private housing built from the 1920s onwards became one of property manager. Nevertheless, despite major periods of demolition and re-building throughout the city, factoring of common properties remains a key feature of residential life, affecting around three-quarters of all households in Glasgow. The management of common property elements in these buildings is therefore key to the well-being of many Glasgow’s citizens.”
Who regulates Factors?
The Institute of Residential Property Management founded in 2002 has introduced relevant qualifications for people working in the factoring industry and many firms have assisted their employees in attaining these qualifications to improve professional standards within the industry.
Since 2012 all Property Factors must follow a Code of Conduct which sets out minimum standards of service – this was established through the Property Factors (Scotland) Act 2011. The Code of Conduct was recently revised with the new Code coming into effect in August 2021. Anyone operating as a Property Factor must supply owners with a written statement outlining the services they provide and the 2011 Act set up a judicial complaints procedure to deal with disputes that can’t be resolved through the Factor’s internal complaints procedure. Factors Direct is registered PF001012.
You can find more about the Act and the Code of Conduct here: Following the introduction of the Property Factors (Scotland) Act 2011, and the associated code of conduct, property factors are well managed and thoroughly regulated, ensuring they operate in a professional manner.
Do you insure the building?
We have a dedicated insurance broker who ensures your building is fully insured and their core service is they ensure that any claims are dealt with promptly with minimum delay and inconvenience to co-owners.
Do you hold a float?
We request each owner contribute an equal amount to a float fund when we are appointed. The float belongs to the owners and is kept in a separate account. It is returned to owners when they sell their property or at change of factor. Even if your Title Deeds do not require the maintenance of a float, it is recommended by the Tenement (Scotland) Act 2014
(http://www.legislation.gov.uk/asp/2004/11/contents). This means that funds are immediately available to carry out minor repairs or to make safe in the event of an emergency.
What is a sinking fund?
The intent of the sinking fund is to aid owners with financing major repair works as required. Please note, any amounts paid into a sinking fund will not be returned to the owner when/if they sell the property as this fund is seen to belong to the building. The sinking fund is held in a separate interest bearing account, an agreed amount is routinely levied from each owner and banked with regular statements provided to clients. The cost of extraordinary maintenance and repair is drawn from that account. The benefit to clients is that they avoid large, unexpected bills for repairs.
Why do we need a factor?
By appointing a factor, it means that both owners and contractors can have a peace of mind when it comes to repair and maintenance work. Self-factoring can often lead to disputes with owners who don’t do their share or refuse to co-operate in managing the communal areas. Additionally, it’s often that builders are reluctant to work with self-factors in the fear that they won’t get paid due to poor admin/payment systems. A factor is important for overseeing this work and ensuring that both owners and contractors are happy with the outcome. Factors are experienced in mediating should there is a dispute.
Why Factors Direct?
Our team excel in client liaison, we aim to be highly responsive to repairs whilst showing consistent communal maintenance to improve the building and heighten its value. We are on call 24/7, we regularly inspect your property to ensure we are proactive to maintenance issues to ensure repairs are not larger than they need to be. Our trusted team of contractors are on hand, so we don’t have long waiting times for repairs to be carried out.
Get in touch today and speak to our team who will be delighted to guide your through the process on 0141 739 4439 www.factorsdirect.co.uk enquiries@factorsdirect.co.uk
