Leaseholders forced to pay council £40,000 each for repairs

By Rosie Lavan

A leading local campaigner has warned the council not to underestimate the “political force” of leaseholders in Islington.

Brian Potter, chair of the newly formed Islington Leaseholders Association, told Islington Now that the 11,000 leaseholders in the borough “really do stand out, not just as a financial force. We are now a political force.”

He said: “That sort of [political] leverage is the only thing that works and it works right up to central government. That’s why they have been so loathe to allow leaseholders to join hands.”

Housing concerns continue to dominate the political agenda in the borough, and the leaseholders issue has become particularly contentious.

Leaseholders, who bought their properties from the council, have been struck with huge bills for repairs to communal areas of buildings and estates they share with council tenants.

Residents on the Spa Green estate, just off Rosebery Avenue, have faced bills of up to £40,000 per leaseholder, and on the St Luke’s estate bills have reached £20,000.

Anna Scott, a leaseholder on an estate in St George’s, said the charges had “slaughtered a lot of the leaseholders round here”.

She said two of her neighbours, also leaseholders, had been forced to move because they could not pay the bills: “It’s absolutely diabolical that some leaseholders have had to move out – further out of the borough and further out of London.”

Ms Scott said one of the main reasons for the huge service charges leaseholders have received was the Major Works programme, which the council has undertaken to meet a target set by the government in 2000 to bring social housing up to a “decent standard” by 2010.

She said the council had been forcing through these works all at once in an effort to meet the target. Works include repairs and replacement of windows, roofs, and improving security for shared entrances.

Ms Scott said that complaints from leaseholders, and suggestions for alternative, cheaper ways to carry out the works, had been ignored.

The major works programme is being handled by Homes for Islington (HfI), the much-criticised Arms Length Management Organisation set up to manage the borough’s housing stock.

A senior spokesman from HfI’s Major Works department said leaseholders were consulted throughout the early stages of planning major works.

He said: “We do listen, but then it’s about how they [leaseholders] are going to pay.”

He defended the controversial process for appointing contractors to carry out the works: rather than the open bidding that used to determined which firms would carry out work on social housing, HfI chooses which firms it will award contracts to.

He said HfI offered leaseholders favourable interest rates when paying their bills and independent debt advice was available for vulnerable leaseholders.

For those who struggle to pay, he said ultimately options include putting a charge on the property or arranging equity release.

He conceded that these serious steps, which effectively relinquish the security of peoples’ homes, could cause enormous concern, and said that he knew of only three people in the borough who had been forced to investigate these options.

Councillor Terry Stacy, deputy leader of the Liberal Democrat council and executive member for housing, defended HfI and the council’s housing policy.

He said: “By securing and setting up the ALMO we released over £120 million investment into the council’s housing stock.”

He said the council been “catching up on 30 years worth of underinvestment” by previous Labour councils.

Both Cllr Stacy and the HfI spokesman said that the £40,000 bills for Spa Green leaseholders were due to the fact that the estate is listed by English Heritage and all works carried out have to meet with the original design specifications set by the architect Berthold Lubetkin in the 1940s.

Cllr Stacy says leaseholders should have taken this into account when they bought their properties.

“They should have had a good survey done – they would have been told that.”

He also suggested leaseholders who bought under Mrs Thatcher’s right-to-buy policy were in a comfortable position, now owning flats worth a great deal more than the amount they paid in the 1980s. A two bedroom flat on Spa Green can fetch up to £400,000.

Cllr Stacy said the Liberal Democrat council was committed to the housing issue – former executive members for housing have included a council leaseholder and a council tenant. Cllr Stacy himself is a housing association tenant.

But his words are unlikely to convince campaigners. Referring to the situation for leaseholders in the neighbouring borough of Camden, Mr Potter claimed: “People working for Camden council were told to treat leaseholders as an open cheque book. I don’t doubt that for one second that the same applied to Islington.”

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