TPI Service Charge Index 2026: Management Fees Rose 2% While Prices Rose 6.1%

TL;DR: The Property Institute's Service Charge Index 2026 covers 2,137 estates and 117,052 homes from 13 member firms. Across that sample, management fees rose 2% between 2024 and the 2026 budget, while CPI rose 6.1% and the Index's own ONS data shows chartered surveyor salaries up 5.5% in a single year. The management fee line fell in real terms while the statutory work behind it grew. The practical response is to know your hours per block and to keep records a leaseholder or tribunal can check.

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#What the TPI Service Charge Index 2026 Measured

The TPI Service Charge Index 2026 is a benchmark of service charge costs built from 2,137 residential estates covering 117,052 homes in England, Wales and Scotland (Index, p.3). The data came from 13 TPI member firms and runs from 2024 to 2026. 88% of the estates are under 11 metres, 7% are 11 to 18 metres, and 5% are over 18 metres.

Read every figure below with four caveats the Index sets out itself:

• 2026 figures are budgets. The 2024 and 2025 figures are actuals. The 2026 figures are largely budgets and may differ from final costs (p.3).
• Averages are not bills. Apportionment under each lease means individual bills vary widely.
• Contract cycles move categories. Renewals and retenders do not happen uniformly across the sample, so a category's year-on-year change can reflect timing.
• It is a sample. TPI says its members manage over two million leasehold homes (p.2). The Index covers 117,052 of them, under 6% by our arithmetic.

Due to apportionment, service charge bills will vary greatly between residents, so aggregated cost averages will not be representative of actual leaseholder bills.

TPI Service Charge Index 2026, p.3

#Management Fees Rose 2% While Prices Rose 6.1%

Management fees across the sample rose 2% between 2024 and the 2026 budget, from £42.10m to £42.99m (p.5). CPI rose 6.1% from January 2024 to January 2026, the ONS figure the Index uses (p.4). On those two numbers, the fee line is roughly 4% lower in real terms than it was in 2024.

The path was uneven: management fees fell to £38.64m in 2025, then the 2026 budgets put them back above the 2024 level. As a share of total spend they sat at 12.9%, 12.1% and 12.6% across the three years (p.7).

The cost of delivering that management rose faster. The Index cites ONS data showing real estate activities earnings up 4.1% between 2024 and 2025, and average gross salaries for chartered surveyors up 5.5% over the same year (p.9). Those are single-year figures. The Index gives no 2026 comparison for either.

TPI's own reading is that the stable share shows management costs "have tracked with overall service charge costs" (p.9). The share figure and the inflation figure describe different things. The fee kept its share of a bill that itself grew 5.8%, slightly under inflation, while the people who deliver the service got more expensive.

The fee line does not capture every pound an agent bills to a block. The Index's Building Safety Act compliance category explicitly includes "additional fees for MA services" (p.5), and some admin fees sit under general expenses. Where an agent charges separately for building safety work, that income appears outside the 2% figure.

#A worked example

Take a hypothetical 40-flat block on a fixed fee of £300 per flat in 2024: £12,000 a year. A 2% rise takes it to £12,240 for 2026. Matching CPI would have taken it to £12,732.

The gap is £492 a year on one block. Across a portfolio of 50 similar blocks, it is £24,600, before any extra hours the building safety regime adds. The figures are illustrative. Run the same sum on your own fee schedule.

#Where the Rest of the £2,880 Went

The average 2026 budget is £2,880 per leaseholder, up 5.8% since 2024 against CPI of 6.1% (p.4). On the Index's 12.6% share, the management fee accounts for roughly £363 of that average, by our arithmetic.

Most of the increase went into reserve funds. Across the ten categories in the Index's table, budgeted spend rose by £14.1m between 2024 and 2026, and £11.6m of that was reserve fund contributions (p.5, our arithmetic). Reserve contributions rose 26% and now make up 16.4% of the 2026 budget (p.8).

The main categories moved in both directions:

Source: TPI Service Charge Index 2026, pp.5 and 7.

Repairs and maintenance is still the largest category, and its budget fell 3% while BCIS reported building maintenance prices up 3.3% on average over the same period (p.8). The Index offers contract timing as a general caveat. For your own blocks, a falling repairs budget against rising prices is worth a line of explanation in the budget notes.

Building Safety Act compliance costs grew fastest, up 53%, yet remain 1.5% of the 2026 budget (p.9). They peaked in 2025 at over £5m across the sample, up 59% on 2024, and the 2026 budgets put them 4% lower at £5.0m. The Index ties that peak to the initial wave of work on buildings over 18 metres: registration with the Building Safety Regulator, safety case reports and the Building Assessment Certificate regime.

Costs of complying with the Building Safety Act 2022 and the new Building Safety Regulator (BSR) regime have risen 53% in the last two years.

TPI Service Charge Index 2026, p.9

#Budgets Are Running Ahead of Actuals

The three years in the Index are not like for like. 2024 and 2025 are actual costs. 2026 is largely budget (p.3). Read that way, most of the 2026 increase comes from one category.

Actual spend fell in 2025. Across the ten categories, actual costs went from £325.8m in 2024 to £319.8m in 2025, a 1.9% fall (p.5, our arithmetic). Per leaseholder, the Index puts the 2025 fall at 0.5% (p.4). The 2026 budgets then rose 6.3% on 2025 costs (p.4).

Most of that rise is reserves. The 2026 budgets are £20.2m above 2025 actuals, and £12.7m of the difference, 63%, is reserve fund contributions (p.5, our arithmetic). Leave reserves out, and budgeted spend for 2026 is 0.9% above what was actually spent in 2024.

The Index offers its own explanation (p.8). Budgets for 2025 were set while inflation was high, costs eased during the year, and year-end surpluses were, subject to leaseholder approval, transferred to reserves. It may also reflect budgets catching up with historic underfunding for major works.

Both explanations end in the same question from a leaseholder: where did last year's surplus go? The Index's appendix sets out the rule (p.12). Service charge money is held in trust, and a year-end surplus is credited back to leaseholders, not kept by the managing agent, RMC or landlord. Moving it into the reserve fund is a decision, and the record of that decision is what the leaseholder will ask to see.

#Height and Age Explain More Than Inflation

Building height is the strongest predictor of service charge level in the dataset (p.10). Average 2026 budgets per leaseholder are £2,418 under 11 metres, £3,507 for 11 to 18 metres, and £4,447 over 18 metres.

Age is second (p.11). Leaseholders in buildings less than 25 years old average £2,508, against £2,411 for 25 to 50 years and £5,208 for buildings over 50. The two effects compound: 18m+ buildings built more than 25 years ago average £7,337 per leaseholder, compared with £3,706 for newer high-rise and £2,387 for older low-rise. Reserve fund contributions in older buildings are 2.5 times those in newer ones, and insurance is roughly double.

Across the whole sample, the average per leaseholder runs from £1,525 at the 10th percentile to £8,680 at the 90th (p.4). If a leaseholder holds up the £2,880 headline against their own bill, height and age are the two strongest predictors the Index found, and the first two things to check.

Eight of the Index's ten categories match headings in the government's proposed standardised service charge demand form, which is not yet in force and is expected from 2027. If you already budget under those headings, comparing your blocks with the Index is a straightforward exercise.

Read what the 2027 standardised demand form will require →

#What This Means for Managing Agents

For a managing agent, the Index points at three operational questions.

1. What does each block cost you in hours? With the fee line flat in real terms and salaries up, the margin on a block is set by the time it takes. Building safety work on higher-risk buildings recurs: the safety case report has to be reviewed and kept current, and so does the information given to residents. Track hours per block for one quarter, split into routine management and building safety, and you will know which contracts to reprice at renewal and what to put in front of the client when you do.

2. Can a leaseholder or tribunal check your figures? The Index's appendix restates the legal baseline.

All service charges must be reasonable by law, and leaseholders have the right to challenge their reasonableness at the First-tier Tribunal.

TPI Service Charge Index 2026, p.12

The tribunal's jurisdiction comes from section 27A of the Landlord and Tenant Act 1985. A 53% rise in building safety costs is easy to justify when each invoice links to the inspection or assessment it paid for. It is much harder from a nominal ledger alone. The same applies to any separate fee you charge for building safety work. The RICS Service Charge Residential Management Code, 4th edition, approved by SI 2026/298 and in force since 7 April 2026, is a code the tribunal can take into account when it decides whether a charge was reasonable.

3. Can you explain the reserve fund rise in one paragraph? Reserve contributions drove most of the increase in this sample. TPI suggests two reasons: 2025 year-end surpluses transferred to reserves with leaseholder approval, and budgets addressing historic underfunding for major works in older buildings (p.8). A leaseholder who sees their reserve contribution up a quarter needs the major works plan behind it, with the dates and the estimated costs. Without that, the reserve line reads as an unexplained increase.

#Which Line the Software Sits On

One cost the Index cannot separate is software. A flat fee and a heavier statutory workload push agents towards tools, and the tool's cost has to land on a line somewhere.

Some of it no longer lands on the fee: several platforms publish per-block prices invoiced to the block's service charge. Charged that way, the platform cost sits outside the management fee, most likely under general expenses or a building safety line. In the Index, general expenses rose 8% and Building Safety Act compliance costs, which include "additional fees for MA services", rose 53% (p.5). Neither figure says how much of that is software, and the Index makes no claim either way.

There is nothing wrong with recharging a cost the lease allows. A 2% fee line, though, no longer describes everything a block pays for its management, and two agents charging the same fee can cost a block very different amounts.

#Where Brocade Fits

Brocade keeps the evidence and the money in one record. Budgets use RICS service charge categories with budget against actual by category. Reserve fund contributions sit in an append-only ledger that leaseholders can see in their portal, and the agent plans major works against a 10-year projection. Compliance costs are categorised into the budget as they are recorded, and leaseholders can drill down from a budget category to the compliance work behind it and its evidence. A leaseholder query or a tribunal bundle then starts from the record, without a search through email and shared drives.

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#Questions

#What is the average service charge in the TPI Service Charge Index 2026?

The average 2026 budget is £2,880 per leaseholder, up 5.8% on 2024 against CPI inflation of 6.1%. TPI says the per-leaseholder average is not representative of actual bills, because apportionment under each lease varies. The 10th to 90th percentile range is £1,525 to £8,680.

#How much did managing agent fees rise in the TPI Service Charge Index 2026?

Management fees across the sample rose 2% between 2024 and the 2026 budget and held at around 12.6% of total spend. Over the same period CPI rose 6.1%, so the fee line fell by roughly 4% in real terms. Additional managing agent fees for building safety work are counted in the Index's BSA compliance category, outside the 2% figure.

#How many buildings are in the TPI Service Charge Index 2026?

2,137 residential estates covering 117,052 homes, submitted by 13 TPI member firms across England, Wales and Scotland. 88% of the estates are under 11 metres. It is a sample, so treat it as a benchmark for comparison rather than a market average.

#Why did reserve fund contributions rise 26%?

TPI suggests two reasons: 2025 year-end surpluses transferred to reserves with leaseholder approval, and budgets addressing historic underfunding for major works, particularly in older buildings. Reserve contributions are 16.4% of the 2026 budget.

#Are 2026 figures in the TPI Service Charge Index actual costs?

No. The 2026 figures are largely budgets. The 2024 and 2025 figures are actuals, the final costs paid by leaseholders, so the 2026 numbers may change when accounts close.

#Further Reading

• TPI Service Charge Index 2026 (The Property Institute, PDF)
• The Managing Agent's Service Charge Compliance Checklist (2026)
• The Standardised Service Charge Demand Form: What the 2027 Leasehold Reforms Require
• What the RICS Service Charge Code 4th Edition Changes for Managing Agents
• Building Safety Act Costs

This article is for informational purposes. Figures are from a sample of 13 firms and are not a market average. For advice on a specific lease or service charge, consult a qualified property professional.

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