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There are many terms related to housing companies and property management that shareholders and residents should be familiar with. Below are the most essential ones.
A housing company, commonly known as a housing cooperative, is a limited liability company and a common form of ownership or management of a building or buildings consisting of housing shares in Finland, regulated by the Housing Companies Act. At least more than half of the floor area of a housing company must be residential apartments controlled by shareholders; otherwise, it is a real estate company. The highest decision-making body of a housing company is the general meeting, which consists of the owners of shares entitling them to control the apartments. The practical management is handled by the board, elected annually by the general meeting, usually together with a property manager chosen by the board, in accordance with the articles of association and the Housing Companies Act. The purpose of a housing company is to take care of the building to meet the housing needs of the shareholders. One of the advantages of a housing company is that common areas, such as the yard and stairwell, can be maintained more systematically.
The Housing Companies Act is a law that defines the rights, responsibilities, and obligations of housing companies and their shareholders. The law applies to all housing companies. The Housing Companies Act includes provisions on the maintenance, repairs, and decision-making of housing companies. One of the strongest principles of the law is equality, which means that the general meeting, the board, or the property manager can only decide and act on matters that are considered to benefit all shareholders. The Housing Companies Act was reformed in 2010, increasing the responsibilities of housing companies, particularly regarding maintenance. In addition to the Housing Companies Act, the operations of a housing company are also guided by its articles of association.
An energy certificate is a document that indicates the energy efficiency of a housing company. Efficiency is measured on a scale from A to G, with A being the best. The energy certificate is based solely on the characteristics of the building. It takes into account factors such as insulation, windows, ventilation, and heating. Since the comparison is based on the building’s characteristics, the energy consumption habits of the residents do not affect the energy rating. The energy certificate is mandatory for all buildings applying for a building permit, as well as for single-family houses built after 1980 that are being sold or rented. The energy certificate is specific to each building. Each heated building in a housing company must have its own certificate. A well-prepared energy certificate can bring cost savings to the housing company and serves as a tool for future energy-saving measures. Retta Property Management offers energy certificate preparation as an additional service to its clients.
A board meeting is a joint meeting of the members of the housing company’s board, where decisions regarding the housing company are made. The board, elected annually by the general meeting, meets for the first time in an organizational meeting, where the chairman of the board is elected and the procedures for convening meetings are decided. Generally, the chairman convenes the board meeting as needed. All board members have the right to attend board meetings. Typically, the property manager also has the right to attend, but cannot vote unless they are also a member of the board.
A maintenance loan is a long-term loan taken by a housing company to finance maintenance and annual repair projects for the property. The maintenance loan is repaid through the maintenance charge and is not allocated to individual shareholders. The maintenance loan cannot be paid off by the shareholders.
A maintenance log is a document that contains property-specific information and goals for the maintenance and upkeep of the property, as well as instructions for those responsible for the maintenance. The maintenance log can be created by the housing company itself or ordered as a service from an expert. The maintenance log can be in paper form or, more commonly nowadays, electronic.
A maintenance company is responsible for the maintenance of the housing company’s property and the cleanliness of common areas and yard areas according to the agreed contract. Not all housing companies have a maintenance company; maintenance tasks can also be handled by shareholders through voluntary work. In practice, maintenance workers take care of small maintenance and repair tasks for the housing company. The tasks of a maintenance company include 24/7 on-call service, moving notifications, maintaining the resident register, changing names on doors, maintaining the key register and handing over keys, ordering additional keys, opening doors for persons registered in the house register, monitoring the condition of the property, maintaining lighting, monitoring heating and ventilation systems, flagging, small repair tasks such as unblocking drains, and handling urgent cases such as water damage. Additionally, maintenance companies take care of outdoor areas, for example, by washing yard areas, shoveling snow, sanding, mowing the lawn, removing loose trash, and emptying yard drains. The tasks of a maintenance company in a housing company vary according to the contract.
Property management is an expert service directed at the board of a housing company, provided by a team consisting of a property manager, property secretary, accountant, and technical property manager. The experience and expertise offered by a property management company assist the board and shareholders of housing companies in decision-making. The property manager acts as the operational leader of the housing company, following the instructions given by the board.
A property manager is the right hand of the board of a housing company and is responsible, together with the board, for the administration of the housing company. The board selects a property management company to handle the administration, accounting, and financial management of the company according to the instructions given by the board. The board and the property manager form a close working partnership: the property manager prepares matters for the board’s decision-making. The tasks of the property manager broadly cover various housing company matters, from handling service tenders to resolving building disturbances. The property manager’s role is to ensure the smooth running of the housing company’s daily operations and the favorable development of the property’s market value. The property manager is assisted by a property secretary, accountant, technical property manager, and many partners such as the maintenance company. The property manager is most commonly selected by the board according to the articles of association. A property management entity can also be chosen as the property manager, in which case a person responsible for the company is specifically appointed.
A property manager’s certificate is an important document required when selling or renting an apartment, as well as when applying for a loan, to show the share ownership recorded in the shareholder register. The property manager’s certificate includes matters stipulated in the Housing Companies Act, such as a summary of the company’s and the apartment’s identification details, the company’s finances, the company’s buildings and their condition, information on repairs carried out and planned in the company, and other significant information. The property manager’s certificate is ordered from your own property management office and is chargeable because its compilation requires various work stages, time, and expertise.
The facade of a housing company is the outer shell of the building, which protects the house from rain, wind, and sun. When the property reaches around 30-40 years of age, a facade renovation is usually necessary. A facade renovation is a major effort for the housing company, although it does not require residents to move out. There is no typical facade renovation as it varies according to the needs of the housing company. With proper planning, too small or too large repairs can be avoided, and the best outcome can be achieved economically as well. Timely communication about the progress of the facade renovation is of utmost importance to both contractors and residents.
A real estate limited company (RELC) is a company whose operations are based on the management or ownership of property spaces. It operates like any other limited company. See also housing company.
A property register extract is a document that lists the most significant information about a property, such as the property identifier, road rights, and area. This document is needed, for example, when applying for a building permit.
A property secretary assists the property manager in a property management office and is responsible for customer service and office tasks. Duties include customer service via phone and email, share transfers, property manager’s certificates, sending maintenance fee invoices, water billing, allocation of parking spaces and sauna shifts, and handling fault reports. Additionally, the property secretary may draft contracts, notices, and invitations, order keys, and book meeting venues. The property secretary works with the property manager, the residents of the housing company, and partners.
An accountant is a financial expert responsible for monitoring the income, expenses, assets, and liabilities of a housing company. Duties include managing day-to-day bookkeeping and maintenance fee control, loan management, preparing the housing company’s financial statements, and filing tax returns. The primary task of accounting is to communicate with the administrative property manager regarding the financial situation of the housing company and to guide decision-making on financial matters.
A renovation project is a housing company’s initiative to repair or refurbish an existing building or property. Renovation projects are usually extensive and carried out only a few times for a property, which is why there are many phases, including needs assessment, planning, construction, supervision, and reception. The housing company’s board is responsible for the renovation project and, together with the professional assistance of the property manager, prepares the planning, contract, and supervision agreements.
A condition assessment is an evaluation of the current condition and repair needs of a property, primarily determined without interfering with the structures and based on visual observations. Surface measurements are also possible. A condition assessment is part of systematic property maintenance and should be updated after renovation projects or at least every five years to anticipate future repairs and maintenance needs. The condition assessment is generally accompanied by a long-term maintenance plan (PTS), which outlines the estimated implementation times and cost estimates for the assessed future repairs over a ten-year period.
A condition inspection is most often a technical assessment of a building’s condition conducted in connection with a property sale. The inspection may include, for example, moisture measurements. The purpose is to provide impartial information to the various parties about the building’s condition, repair needs, and recommended actions. The condition inspection is carried out by a technical expert. See also condition survey.
A condition survey is a more detailed examination of a property’s building to determine the cause of any potential damage. The survey involves breaking into structures and is typically conducted by building and technical experts. See also condition inspection.
An HVAC renovation is a housing company’s plumbing renovation, also known as a pipeline renovation. The letters HVAC stand for heating, water, and air. The renovation is usually necessary when the pipes are about 40-60 years old. In an HVAC renovation, in addition to the pipes, the ventilation and other building services may also be refurbished. In other words, the repair needs of the property determine the scope of the pipeline renovation. The repair needs of the property are identified in the maintenance needs assessment.
A renovation notification is a shareholder’s written notice to the housing company and the property manager about maintenance work that the shareholder intends to carry out in their own apartment, which may affect the building under the housing company’s responsibility or the living conditions of other shareholders. The renovation notification must be submitted in advance and should be as clear as possible. The housing company must have time to process the notification and determine whether the renovation work requires, for example, a building permit. The housing company also has the right to supervise that the maintenance or renovation work is carried out according to good building practices, but the shareholder is primarily responsible for the execution of the maintenance work.
A change of address notification is a notice given to the housing company and the property manager about moving in or out of the building. Unfortunately, a change of address notification made to the post office or the local register office does not get forwarded to these parties. Although notifying the housing company is not legally required, it is recommended, as it helps update the building register, mark the correct information on the door and nameplate, and ensure the right person is given access with the master key. Additionally, water charges, parking space rentals, and sauna shift lists are updated when people move. The property management office usually also handles the coordination and billing of parking spaces, sauna shifts, and water charges.
The emergency plan is a plan and document concerning the safety of the housing company, its residents, property, and the environment. Its purpose is to improve everyday safety by helping to identify risk factors in the living environment, prevent hazards, and prepare for and respond to emergency situations. An emergency plan must be prepared for all housing companies with at least three residential apartments. The board of the housing company is responsible for the emergency plan and actively participates in its preparation and updating, as well as informing residents about its contents.
A plumbing renovation is a familiar term for an HVAC renovation, where the heating, water, and air systems of a housing company are renovated.
PTS, or a long-term maintenance plan, is a condition and repair plan for a housing company’s property, designed for a minimum of ten years. It is based on property maintenance, upkeep, and regular condition assessments.
PTS provides the housing company’s board with information on the timing and costs of necessary repairs. It serves as a tool for the board, making it easier to plan future renovations cost-effectively while minimizing surprises.
The PTS is typically prepared as an annex to a condition assessment in collaboration with an experienced expert.
The financing charge, also known as the capital charge, is a fee specified in the housing company’s articles of association. It is used to cover the interest expenses and repayments of long-term loans taken out by the housing company.
The financing charge is typically allocated to shareholders based on either square meters or shares, as defined in the articles of association. Shareholders usually have the option to pay off their entire share of the financing charge in a lump sum or through partial payments at times determined by the board.
A housing company is a common term for a condominium housing corporation.
The board of a condominium housing company, or housing company, represents the shareholders and is responsible, in accordance with the Housing Companies Act, for managing the administration, finances, and property maintenance of the housing company.
The shareholders of the housing company elect the board at the general meeting. A member of the housing company’s board is elected to a position of trust, offering a great opportunity to influence matters concerning their building and day-to-day operations.
Board members participate in making both small and significant decisions within the housing company.
The house rules of a housing company are guidelines defined by the housing company to facilitate communal living and enhance the comfort of residents. Every housing company should ideally have house rules. These rules typically include instructions regarding the use of shared spaces and yard areas, making alterations to apartments, and quiet hours when noise must be minimized in the building.
The house rules are often displayed on the notice board in the stairwell or distributed to each apartment. The house rules are approved at the general meeting, after which they are binding for all shareholders.
A shareholder in a housing company, or a shareholder-owner, is the owner of a share or group of shares in their apartment. The shareholder has the right to have their matters discussed at the general meeting, participate in the meeting, and renovate their own apartment.
The shareholder also has the obligation to pay the housing fee and take care of the condition of their apartment.
A technical property manager is an expert in building and building systems services for properties. They assist the administrative property manager in managing the property’s technical aspects and, together with the housing company’s board, develop maintenance and repair plans for the property.
Their duties include tasks such as property damage assessments, organizing repairs, conducting condition assessments and creating long-term maintenance plans (PTS), performing bathroom condition surveys and moisture measurements, creating emergency plans, overseeing construction, inspections, and controls, as well as tendering and supervising contracts.
Technical property managers also directly serve the housing company’s shareholders, for example, overseeing individual apartment repairs and alterations, ensuring work safety, project quality, and compliance with legal requirements.
A financial statement is a document prepared jointly by the property manager and the financial administration, which provides information about the housing company’s operational results and financial position. In other words, it shows where the money has been spent and how the expenses have been covered. The financial statement must include accurate and sufficient information for the shareholders.
The financial statement, along with the management report, auditor’s report, and/or activity inspection report, is discussed at the general meeting.
A ledger is a record of transactions for a housing company and is part of the financial administration’s accounting. The service charge and rental ledgers are part of monitoring service charges and rents, while the purchase ledger is used for monitoring the payment of the company’s purchase invoices.
The purchase ledger contains a list of invoices received by the housing company and their payments, while the service charge ledger tracks the service charge targets and payments from shareholders.
A fault report is a notification made by a resident to the maintenance company about a malfunction or issue in the apartment, property, or yard area that requires repair. Typical fault reports include, for example, a leaking faucet or a clogged drain.
The articles of association are the internal rules and regulations of a housing company required by the Housing Companies Act. They are approved by the general meeting and bind all shareholders. The articles of association define how the housing company operates.
The minimum content of the articles of association is specified directly in the Housing Companies Act, which requires the inclusion of details such as the company’s name, the location of the buildings and properties managed by the company, the location of each shareholder apartment on the property, and which shares (or groups of shares) grant the right to manage specific apartments, as well as the basis for determining the housing fee.
Additionally, the articles of association can include provisions that differ from the Housing Companies Act, such as maintenance responsibilities, and can address specific matters of the housing company as needed or desired.
A general meeting is the highest decision-making body of a housing company. In the general meeting, the company’s shareholders gather to make decisions about the affairs of the housing company. The property manager and the housing company’s board prepare the general meeting and convene it.
The general meeting makes decisions on matters that the board does not have the authority to decide on, either according to the Companies Act or the articles of association. The general meeting, for example, elects the board, approves the financial statement, and adopts the budget for the coming year.
The responsibilities of the general meeting are defined in the articles of association and the Housing Companies Act. The annual general meeting must be held within six months of the end of the financial year. If necessary, an extraordinary general meeting can be called.
A maintenance charge is a fee collected from shareholders to cover the housing company’s annual maintenance and repair costs. The amount of the maintenance charge is determined by the general meeting each year.
An extraordinary general meeting is a meeting that is held in addition to the annual general meeting, where shareholders can exercise their decision-making power just like in the regular general meeting. An extraordinary general meeting must be held if the articles of association specify it, if the general meeting or the board deems it necessary, or if a shareholder, auditor, or activity inspector requests it.
