Enhancing Housing Cooperatives: Riksbyggen Introduces BrfTempen for Financial Health Monitoring
In an era where effective management is crucial for the sustainability of housing cooperatives, Riksbyggen has launched a pioneering tool named BrfTempen. With 85 years of experience and a clientele comprising over 4,000 management customers, Riksbyggen offers remarkable insights into the state of Sweden's housing cooperatives. Frank Fagerlund highlights that BrfTempen serves as a health check for housing cooperatives, outlining financial standings and pinpointing areas for improvement.
One significant challenge that boards face is the uncertainty regarding where to initiate improvements. This ambiguity often leads to an overwhelmed board attempting to tackle multiple issues at once, which can result in inefficiency. BrfTempen addresses this by enabling boards to identify the financial areas where costs significantly exceed the norm, allowing them to focus on crucial issues. For instance, boards can assess if they are incurring higher energy costs than necessary or carrying excessive debt compared to peer associations.
The functioning of BrfTempen is straightforward: housing cooperatives input a variety of details about their association, after which experts at Riksbyggen analyze the data and provide a complimentary report. This report outlines the six key financial metrics that are vital for the assessment of the cooperative’s performance, including annual fee, energy costs, interest costs, debt level, savings, and operating costs. The comparisons drawn are tailored based on factors such as the size of the association and the year it was constructed, ensuring a relevant and fair assessment. For example, a newly built cooperative from the 2020s cannot directly be compared to one established in the 1930s.
One essential metric monitored is the saving per square meter, which is a vital consideration in the maintenance plans of the housing cooperatives. Should the savings fall below the necessary thresholds, boards are encouraged to strategize on cost reductions in areas where savings can be realized while simultaneously exploring avenues for augmenting various income streams. If circumstances warrant, adjusting the annual fee becomes a last-resort option to elevate savings to the maintenance plan's required levels. While immediate financial challenges can be managed, Fagerlund emphasizes the importance of focusing on long-term strategies to avert sudden annual fee hikes.
Moreover, BrfTempen also aids in time management for board members. According to a survey conducted at the end of 2024, over half of board members dedicate between 1 to 4 hours a week on association responsibilities, while nearly a quarter allocate between 5 to 12 hours. The ultimate aim of BrfTempen is to streamline this process. By identifying functional areas alongside those needing improvement, boards can allocate their time and energy more judiciously.
The six crucial financial metrics outlined in the BrfTempen report provide a comprehensive view of a cooperative’s financial health: 1. Energy Cost (SEK/m²): Indicates energy expenses compared to peers, with potential for sustainable investment. 2. Operating Costs (excluding maintenance): Points to opportunities for operational savings if costs diverge from Key Figures. 3. Interest and Debt (SEK/m²): Essential for monitoring financial responsibilities, guiding stability in negotiations and amortizations. 4. Savings (SEK/m²): Represents the savings for future maintenance, ideally aligning with the maintenance plan. 5. Annual Fee (SEK/m²): Compares the overall fee, inclusive of mandatory charges, with similar associations.
Riksbyggen stands as one of Sweden’s leading developers with a mission to provide attractive and sustainable housing solutions. The cooperative is responsible for managing over 100,000 rental apartments and 200,000 condominiums across more than 4,400 housing cooperatives. Utilizing services like BrfTempen can usher housing cooperatives into a future where financial clarity and sustainability are the bedrock upon which thriving communities are built.
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