What is my Property Float?

Many homeowners will have heard the term “Property Float” and wondered what this refers to. The following FAQs will help answer this question, and your local Property Factoring Team will be happy to discuss any further queries you have.
property float
What does my float do?
Your float is a refundable deposit, which is always returned to you when you sell your property.

The float provides a fund from which we can pay for your development’s expenditure, cleaning, electricity, ground maintenance, repairs, insurance etc.

When you pay your common charges invoice, the float is replenished to be used again for the next period.

What does my property need as a float?
Good practice is to hold at least 6 months estimated expenditure, preferably 12 months.
Where is my float set?

Your float is set in your Terms of Service and Delivery Standards, which are available from the My H&P App and Web Portal.

What if the float is exceeded?

If there is debt at a property, if there are larger repair costs or if the float is simply no longer sufficient, either the homeowners require to provide more funds, work has to stop or HPMS effectively funds your property maintenance.

HPMS customers benefit from our financial stability and careful business practices, developed over 100 years of providing Property Factoring services, and this helps us avoid regularly requesting advance funds for small to medium-sized works, however, this relies on the float funds held being reasonable.

When is my float reviewed?

The float is reviewed periodically and whilst your float is always refunded to you, HPMS strive to operate without requiring to increase the float fund unless absolutely necessary.

For the past 10 + years, we have maintained our ability to support our customers without increasing their float, through a variety of measures, including; sympathetic but robust Debt Recovery, careful financial management of our customer’s properties and a pro-active approach to repairs.

However, as is widely reported, inflation in the wider economy and specifically in the costs associated with the maintenance and insurance of property continue to rise substantially, requiring an increase in floats in 2023 across the factoring industry.

Mitigating these pressures, HPMS customers have experienced excellent value on electricity procurement, insurance procurement and repair and maintenance procurement, allowing many float increases to be restricted to less than a full 6 months estimated expenditure.

What about Factoring my property without a float?

Floats have been a standard feature for homeowners of common property for many decades, including for the operation of pre-1919 traditional tenements.

The requirement for a suitable float is a legal requirement upon homeowners in almost all modern developments and the Code of Conduct for Property Factors has specific regulations relating to floats, in recognition of the float’s essential purpose.

An older alternative to a float was to operate an annual system of estimated expenditure. However, this typically required a sum greater than a float to be paid each year and which cannot be refunded until up to a year after you may sell your property. Or, operating without a float would require homeowners to deposit estimated repair costs each time a repair is reported. Both of these options would also incur greater administrative costs, increasing management fees too.

Neither of these systems is fit for purpose in 2023 and your property float is the most effective and transparent method for homeowners to ensure their property is financed properly.

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