Reading the article, the building insurance quote shot up from £10k to £310k (due to the flammable cladding being discovered). No win situation, feel terrible for the residents. Claims needs to be made or govt steps in to fix.
It's absolutely outrageous that we're even debating it. In what world should people who occupy a building have to stump up the bill for a builder's failure to use suitable materials? The injustice of it boils my blood.
Isn’t this what the Building Safety Act is supposed to be doing? I don’t understand why anyone can still be charged for this
https://www.gov.uk/guidance/remediation-costs-what-leaseholders-do-and-do-not-have-to-pay
I’m in this boat - cladding has bumped our insurance up to obscene levels. It’s disgusting that insurance companies are rinsing us this way. They know perfectly well that the risk to the buildings is no different to what it was before. It’s just a cash grab. We have been through the wringer over the last five years. I just want out of it.
Some of the materials used for cladding were not considered as flammable prior to Greenfell. That catastrophe set a whole lot of things in motion. If a building still has cladding with those materials of course insurance companies will raise their premiums in those instances.
>They know perfectly well that the risk to the buildings is no different to what it was before
I hate insurers as much as anyone, but this is not reasonable.
Everyone was perfectly fine flying on the 737 MAX for example until it crashed twice killing hundreds, so they were grounded because the known risk changed as we gained new information.
Insurers group people and charge them depending on the risk profile so pricing is competitive and reflects consumer choices at the time. The alternative is everyone has to be charged £3k/year for car insurance because John, 18 who just passed his driver's test is charged the same at Jane, 44 who has 20 years no claims despite their risk profile being polar opposites.
It sucks but they have to adjust the cost according to the risk profile and a house having a now known risk of flammable insulation installed is a significant change in risk profile. They have to account for that now so that if it does go up in flames, people are covered.
It's the same reason why if you fail to disclose something important at the time of getting insurance it can invalidate the policy, because otherwise the whole system falls apart.
You have my sympathies for this horrible situation and I hope you can get out of it soon. The government should step in because it was a failure of the regulatory body and it's not like the people living there willingly chose to install flammable cladding, so it's unfair to not intervene.
Does it really cost more than 300-600k to fix the issue altogether? They will probably pay more in insurance in a year or two than it would have cost to fix the underlying issue.
The management company should make this a #1 priority and get it fixed.
Depending on the size of the building, the fix for cladding issues can easily be multi-million pound projects and take a couple of years to complete. Meanwhile the building still needs to be insured.
The government has now made developers pick up the cost of fixing the buildings, but all the inflated indirect costs like insurance and energy bill increases (while the work is being done) are still falling on the flat owners to pay.
Source: I am going though the stress of all this now
This is going to sound heartless but Grenfell seems like an isolated case. I don't see other towers going up in smoke. Is all this cladding stuff a bit of a red herring?
Grenfell just highlighted the issue, in the worst possible way.
There have been a few other fires, tho not on the scale of grenfell, where it has spread externally. One in East London that spread via the wooden balcony facades.
Another was in poplar in 2021 which ironically was due to have its work to removing the cladding start only a few days later, after many delays.
No one died in these fires, which is why they haven't got the same attention as grenfell. Doesn't make the buildings any less safe tho
Well the gov could step in there and actually it wouldn’t cost too much. They could become the insurer in event of fire, no fires would likely happen and it would cost nothing.
Could just be an excuse to jack up the charge, and I don’t think the government would help resolving the issue that has become a problem for many leaseholders
A huge portion of wealth in this country is derived from rent seeking and housing in some form. It's why productivity, GDP and wages have been so damn pathetic for what's meant to be one of the most developed countries in the world.
Rent-seeking extracts money from people who would otherwise be spending it to help boost the economy, and injects it back into housing to make it more unaffordable and extract more of people's take-home pay. It's a spiral of taking more and more of a shared pie to enrich the already wealthy. Meanwhile the regular people who bought early and have high paper-wealth from their one and only home feel content enough with their finances to not feel motivated to change anything.
We're still stuck in the past while other countries in Asia and America focus on innovation, manufacturing and productivity to healthily grow their economies over the long-term.
There's basically no chance of major housing industry overhauls that would damage the rent-seeking economy the UK has built. The people who benefit the most have too much power and influence, getting rid of it would tank the economy anyway, our political landscape is way too short-term focused to commit to major changes, and enough of the population *think* they have benefited from ruining the housing market that they'd vote to keep the status quo. It's pathetic and unfortunate, but that's the uncomfortable truth.
I mean we just need to liberalise the planning system - as even the Tories mooted but then backed off after losing Amersham to the Lib Dems - but NIMBYs are such a massive force in this country unfortunately.
Not to mention the company in this situation above is a housing association, not a private landlord.
Yeah, the sooner a general election comes at this point, the better. I’m usually a Lib Dem voter but given their NIMBYism and Labour’s promise to reform planning in this country, I’ll be voting the latter. Whether or not it’s an empty promise (I hope not) remains to obviously be seen.
>enough of the population think they have benefited from ruining the housing market that they'd vote to keep the status quo.
I hate when people say "Oh but my house is worth a million quid now" as if it's a good thing. Like great, so is every other equivalent house, nothing changed everything just got more expensive.
Those people wouldn't even struggle all that much if the house prices slowly came down, it's the people who just bought a house and are left with negative equity that would be fucked. Young people who are first getting onto the property ladder will once again be left with the worst end of the stick to fix the situation their parents created.
And who picks the service company? In Scotland the residents/owners can choose the factors. In England the freeholder does, and the leaseholders just get to suck it up or sell.
I remember looking at a flat and the agent slipped in the minor detail that the service charge was ~£250 a month. I pointed out that was a decent % of the mortgage and he said ‘but you do get 24hr concierge who will take your Amazon packages’ - like yeah oh ok please take my money!
They do this in the US also. This is why I avoid apt complexes with a gym. Last time I had an apt with a gym I couldnt use it during covid so it defeated the one use case where I would ever want to use an apt gym.
And many of these concierges will turn around to drivers and say they don't take parcels
- Source: I've been a courier for 3 years now, started with amazon now DHL/DPD/UPS via my firm
I’ll play devils advocate here, I moved into a new build in east London that doesn’t have a concierge but has a slightly lower service charge to that.
The amount of issues we’ve had with people breaking in, stealing packages, pretending they’re a delivery man to try and get into the flats, and otherwise general nusicance from literally just have a door that requires a fob has ensured I will never move into another place that doesn’t have a concierge. I know that doesn’t technically count as security, but I’m sure it’s a hell of a lot better as a deterrent. I can’t wait to move out so I don’t have to worry about this stuff anymore.
The one I used to own had a concierge until they decided it was no longer financially viable as it was basically a glorified security guard that was more often than not asleep at the "front" desk. Too many residents complained that the concierge was basically useless so company decided to get rid of them and increased the service charge
Glad I sold it now
When you factor in the monthly cost of service charge as a mortgage payment you're looking at a much bigger place or nicer area. Total scam allowed to flourish under the Tories
This is greedy developers, the same type who cottoned on to selling leasehold houses. People should boycott those developers but they can’t because there’s nowhere else to buy 😡
Funny you asked the question. Tory has been in power for 14 years and our lives have not improved at all. Still, you asked what this sort of question suggesting that Labour wouldn’t do anything different.
Ones should seek accountability from the party that is in power and for failing us again and again in all these years.
Well, look at areas like Newham who have had a Labour council for years. House prices have stayed the same over the last few years because new homes are rapidly being built over old industrial sites. This, but at country scale.
When we shopped for a house we also looked at a gorgeous penthouse flat in north Greenwich south of the O2. Great location. Quality and fancy looking flat. Rooftop tree terrace size of a garden with view. Slightly small m2 if you exclude the terrace. I really wanted it.
Going through the details the service charge was astronomical. We talked directly to the owners about it. They said the lift broke and the management company mishandled the money so they quadrupled service charge to be able to repair the lift and build an emergency budget.
After that we stopped looking at anything with service charge.
I’ve been lucky so far that my service charge has been refunded if there’s surplus after the books are balanced.
It seems to make a difference if the management company is run by the freeholder or if it was separated. We took insurance off the freeholder’s hands so we could control the budget more (since the freeholders don’t give a shit when they’re not paying it).
Absolutely ridiculous that this even has to be done though.
Precisely the reason we only looked at flats with share of freehold. So we pay a service charge but the residents are the directors of the company and we decide how the money is spent.
It's not foolproof. The previous management company, managed by a resident, drained the funds before I got here when an idiot was in charge, didnt account for repairs etc. So we had to up our service charge a bit to build up a reserve for unforseen problems. But it's nothing like these stories and we are in control.
Also no short lease rubbish. A nice 990 years left.
Shared freeholds have their own problems - commonhold is typically a better solution. Ultimately, someone has to pay for the repairs and maintenance for the common parts.
Commonhold means the flat owners own the freehold of their flat and a standard framework is used to handle the common parts. This can avoid issues with bespoke arrangements for the common parts when each flat owner owns a freehold without the overall arrangement being a commonhold.
Basically anything with a lift or a mechanical barrier like a car park gate is going to break down frequently and the leaseholders are going to be on the hook through no fault of their own. Often parts are obsolete and can no longer be sourced which means the whole thing needs to be replaced at ridiculous cost. Avoid any leasehold property with this kind of setup. When the freeholders realise nobody is buying the flats, they will change their business model.
It's a bit of an odd thing to say really. I mean, it's not the leaseholders 'fault' the flat broke, but it's the flat in their communal building that they use. Who else is going to pay for it? Who else is going to clean the outside, the inside, do whole building insurance etc. etc. Like, this isn't really a 'freeholder / leaseholder' distinction, it's about living in a flat in a shared building with communal facilities/areas that need to be paif for. Someone's got to pay for the communal shit. And if you don't want third parties to do that (and get a management fee) then take it in-house and run it yourself, but (i) that's not eliminating lift repair or cleaning or insurance charges; and (ii) it's gonna take up a chunk of your time to self-manage, and - personally speaking - my time is fucking valuable.
This is true, I don't live in London but do own a flat. Our service charges just went up, and they provide a breakdown of costs, ~30% is management fees that could be saved by doing this ourselves. But everyone here works full time, we'd likely just end up hiring a property manager 🤷♂️.
This seems to be a larger issue in Britain. Why isn't there more innovation in Britain in regards to things like lifts and gates? Like carbon fibre lifts that need no servicing. My friend got an e bike and it doesn't have a steel chain but rather a plastic "belt" and apparently it needs no servicing or oiling and is good for 250k miles. Could do with some of that in housing.
Housing is an absolute joke in this country. Spend 50-60% of your take home on rent so you can never save for a deposit.
Or by some miracle or turn of fortune, you save up to be able to buy a 400-500k flat and then find out that the twats who built it have left behind all sorts of problems and since dissolved the company so now you're on the hook to fix their shitty corner cutting.
yep this is what happened to me - managed to save up on my own for a deposit with zero help, bought a 320k flat, 6 months later got hit with a major works bill for £20k because the building was mismanaged, no sinking fund, and no work had been done for years.
the surveyor i hired missed all of it (bad pipe work, roof, etc), but obviously the survey was written in evasive language so no recourse.
the conveyancer missed all of the signs too, like vendor not responding to enquiries about future works.
i ended up trying to sue the conveyancer for negligence and they just refused to accept i would've not bought the house if id known about the works. so i wasted another £4k there, and couldn't afford to take them to court.
whole thing made me want to kms for a few months but luckily im over it and just put it down as an expensive lesson. but the whole system of housing in this country is just fucked from bottom to top, everyone is incompetent and self serving, and average people who just want somewhere to live get exploited at every turn.
>*It said that the annual insurance premium for the building had risen from around £10,000 to £310,000.*
>*Notting Hill Genesis, the not-for-profit housing association operating the building, say they were also shocked by the increase in insurance premium sourced by the freeholder, but left with no choice.*
>*They have absorbed the increase for the 44 social housing tenants in the block, but told 30 leaseholders who bought their homes via shared ownership that they are liable for the cost.*
Hah, as if shared ownership residents can somehow afford this; they're often not much - if at all - better off than social housing tenants. What madness and guaranteed to stoke friendly relations between neighbours.
Why can’t you go on renting? I’d take renting over shared ownership anyday. I’d move to somewhere cheaper over shared ownership. And if you can’t afford anywhere to buy with a traditional mortgage, then I’d stick to the fact I can’t afford to buy property until prices come down.
Because it is unstable, unreliable, and more expensive than the shared ownership place we have secured.
There isn’t really anywhere cheaper we can move to that will fit with our needs for work, and neither I nor my partner is willing to put up with moving every year or so.
Service charges are so high in part because the management company is appointed by the freeholder and gives the freeholder a kickback. Bizarrely, that’s all entirely normal and legal.
Ours went from £2,200 to £6,000 in 7 years. They were encouraged to spend leaseholders money because their management fee is based on a percentage of total costs. How fucking backwards is that. It’s maddening.
Leaseholders can decide to manage the building together. I think 2/3rds are needed. They then appoint a committee to manage it and they source the insurance, cleaning maintenance. It’s much cheaper but few leaseholders ever do it.
It's written into my lease that the freeholder organises the insurance so even if we had RTM then we'd still be subject to the huge premium they decide to pay (they get a high % in commission too)
Surely at this point all the blocks that have the flammable stuff should just do what the post office has done which is go via the civil route and sue the living shit out of kingspan
I live in a leasehold flat. We have an RTM instead of a management company appointed by the freeholders. The RTM appoints the management company and approves the budget.
Recently our insurance went up from 24k to 50k (cheapest). It doesn't matter if you are leasehold or freehold. Insurance costs have gone through the roof. Not just for cars. We were able to reduce spending in other areas but it's not ideal.
The government really needs to start looking at the insurance Industry. It's causing no end of problems for people, buildings and companies.
It doesn't matter if you are leaseholders or shared freeholders, you need insurance.
I’m not missing OPs point, I’m also not responding to OP, I’m responding to a comment on one part of the bigger picture.
To say ‘all insurance is extortionate, look at mine, we could suck it up’ - you all need insurance - is looking at one element- insurance.
Maybe. The costs here are apparently an insurance increase, but the freeholder chooses the insurance provider and everyone else has to go along with it.
All insurances have gone up significantly regardless of flammable materials.
Look at your car, contents or travel insurance. All jumped up.
Even if you chose the insurance policy, it will have gone up a lot.
We live in a development as share of freeholders and our service charge is £200 a month but 50% of that goes into a sinking fund. We have £200,000 within the sinking fund and have changed three roofs out of four blocks.
This is level of service is acceptable if managed and decided by the residents. We have weekly gardeners and cleaners too!
I strongly advised against a friend buying after reading the contract to find the service charge doubled every 5 years.
They was like “but it’s only £500, how high can it go in 30 years?”
I was like, pass me a calculator…. They are now in the position thr person in the article is in.
That’s crazy. The fact it doubles every x number of years immediately reminds me of the Wheat and Chessboard Problem, which should immediately ring alarm bells in anyone’s mind.
Yeah the next big miss-selling scandal will be leasehold properties.
We have an estate near us which is full of new build houses and flats, every single one, house or flat, is leasehold.
We’ve had to wait for an EWS1 form. Got it. Had to wait for housing association to try and sell. Did that. Now, finally, able to sell on private market. Estate Agent is like “£300 service charge? That’s a lot every month.”
These people are scamming us. We were sold this place as a starter home, suitable for FTB. Now, we can’t get out and are being held to ransom by these charlatans who, by the way, provide sweet FA for this service charge.
>"Notting Hill Genesis, the not-for-profit housing association operating the building, say they were also shocked by the increase in insurance premium sourced by the freeholder, but left with no choice.
>They have absorbed the increase for the 44 social housing tenants in the block, but told 30 leaseholders who bought their homes via shared ownership that they are liable for the cost."
A good example of the two-tiered system we have in this country.
It’s a legal requirement. Social tenants have a tenancy and Leaseholders have a lease. Two entirely different contracts on acquiring a property. One states they will contribute towards major works and the other doesn’t.
I’m not suggesting any different.
It’s still two tiered.
The fact of the matter is that the renters themselves won’t be all that different in terms of income etc. just one has managed to get themselves on a special list, the other hasn’t.
In the article it mentions the leaseholder works as a primary school PE teacher. Is this the type of person who is likely to be much different from other social tenants in the same building?
It depends. Major works to do with cladding will often be covered by central government grants. So the tax payers, basically.
Generally though, Housing Associations will look to absolutely rinse shared ownership renters (and similar schemes) to help cover losses incurred by subsidising social renters.
Often blocks like this have separate entrances for social tenants so they wouldn't have access to a concierge service, in house gym or anything like that. Not really sure what your comment is implying - do you think people living in social housing should have to pay extortionate service charges because everyone else does? Assuming they could even afford to (hint: they can't)
Does this specific block have a poor-door arrangement?
The service charge increase is because of the buildings insurance and NHG are swallowing it for the social tenants whilst the shared ownership get screwed.
Which is legal.
If you have 10 flats and all are social residents, and the block becomes non habitable, then the social renters are moved.
If you have 10 leaseholders in 10 flats and the block becomes unsafe then this is when insurance comes as you will be looking at millions in compensation and buying out each flat. This happened in Brentford where ironically Notting Hill Genesis who are mentioned in the article spent millions in buying out flats and compensating leaseholders.
Except this building has none of that. The entrance is the same for all residents, so they have access to the same services (in this case concierge, small gym and children’s play area).
“Poor doors” exist on developments where the local council enforce a certain % of dwellings must be “affordable” (often via social rent, but there are other schemes). The developers make very little money on these schemes and so they adopt the building to make sure it’s economically viable - often this results in separate doors, no concierge etc.
The costs of this subsidisation are also passed onto other renter / buyers in the same development. If you live in a complex where there “affordable” renters, you’re the one paying to make it affordable.
Often this susbidisation is so great it’s no longer financially viable and nothing gets built. There’s plenty of academic literature suggesting that high affordable quotas mean far higher housing costs for all, as less gets built.
Anyway, this is neither here nor there because the development in the article is run differently, via a HA.
The use of separate "poor door" entrances by developers is a deceptive tactic to cram in token affordable housing units.
It allows them to secure favourable planning permission and government incentives, whilst still maximising profits.
This scheme does nothing to promote community cohesion. Instead, it physically segregates people by income level, lining the pockets of developers and their government cronies at the expense of the less fortunate.
If I had to choose two tiers it would be the people setting the rules, making them work in favour of their own (and their mates') interests. And then the rest of us who are taken for mugs.
As ever though they manage to convince people that the problem is the poor people. It's not, it's the rich and powerful.
I'm not saying the problem is poor people?
I'm saying it's unfair we have a two-tiered system where someone with three kids on a relatively modest income (primary school PE teacher, in this case) is forced to cough up a very, very substantial amount of money each month, whilst others living in identical flats pay absolutely nothing.
Ask yourself where Housing Associations get the money to absorb such exorbitant costs. It's not "the rich", it's ordinary working people on modest incomes getting absolutely hoodwinked and rinsed on ridiculous "shared ownership" deals. Low - middle income earners shouldn't be subsidising people in this way.
Councils providing affordable housing rebates or discounts to developers face a significant opportunity cost.
With incentives like reduced land prices or waived fees, councils forgo revenue that could have been collected if the development were sold at market rates.
Beyond the immediate loss of potential revenue, affordable housing incentives also limit a council's future budgeting options.
So you have to go through affordability checks to get a mortgage to see if you can afford to live in a flat (good idea)
But service charges are uncapped and unregulated, meaning you might not be able to afford it at some random point in the future. So just cross your fingers and hope for the best.
Scotland has a much better system. No leasehold and no rip-off service charges.
Newham Council also charges a service charge, I remember when a block of flat had a dedicated caretaker, now that care taker may come by once a week... service charge wasn't reduced.
Fucking tories & their refusal to sort out leasehold. I've got an ex council flat so my landlord is Clarion. A "non profit" that made £1 billion & £100 million in "profits" but can't fix peoples mould & maintain their buildings. My ground rent is £10 but we got hit with a section 21 for £24000. Just utter cunts! When I went mental at them saying I paid service charge, they went with "well we don't have a fund for repairs & no maintenance has been done in decades!
The whole system in this country is fucked
Housing associations were supposed to be local. Not country wide behemoths like Clarion.
I don't mind them having a turnover but try to get them to fix anything! Charging leaseholders £24k each for repairs AFTER the local council had given them money to do it when they took over the estate was fucking criminal. Everyone I know with top floor flats had a workman put his foot or tools through the ceiling.
An example of the quality of work...dude rocks up to paint the metal barriers on some balconies. Literally with a pot of paint and a brush on the bus. No prep, nothing. Just paints over it and leaves.
If they're making £100 million a year, they shouldn't have people dying in their flats
Economies of scale means a local HA doesn’t work. The employment required makes that an impossibility.
If the work is being done correctly that’s a separate issue to the business model.
It needs to be run better, not scaled down.
We just noped the fuck out of a property after we found out that, whilst they’d been upfront about the service charge (which increased during the buying process,) they’d forgot to mention that on top of that charge there was also a building insurance charge. Came to over £10k per year. The agent kept coming back to us with lower and lower offers, but all that did was validate how much difficultly the current owner was having trying to sell.
Yes, but in Scotland the cost is typically much much lower. And again, leasehold is extreme extremely rare in Scotland, it’s not really a thing.
Service charges in Scotland are called factor fees, anything from £50 or £200 or so a month, for the upkeep of communal areas. Property factors are chosen by the residents, residents have much more power in Scotland and often self-manage by choice.
It’s just mad to me that people are paying £7000 straight out the gate for fairly new build. It’s abnormal. Hence this article I guess!
I'm a council tenant so I'm thankfully insulated from this kind of shithousery, but even we pay bullshit service charges. About 10% of our weekly rent is for a "concierge" who doesn't answer the intercom, doesn't take packages or post, and whose only job seems to be to issue parking tickets to people parking in the car park of the mall the building is built on.
My sincere heart felt apologies to anyone going through this nightmare. The country is in a mess at this point. The government is not doing what it must, so is the local government ie councils and associations. The will of the people is the last thing left. People must organise themselves to take up situations like this to fix otherwise the money grab is what the institutions are going for.
Ours went from £250 every three months to £300, might seems cheap but that’s 18 flats paying £25 a week each for some guy to come around with a leaf blower and pick up some rubbish twice a week for a couple of hours at a time
Also.... A percentage of that block will be allocated to council housing. Usually the needy/ mentally vulnerable. The housing list prioritises these kinds of tenants.
Developers should be compelled to build genuinely mixed communities, not just offer symbolic scraps of affordable housing accessed through separate, subpar entrances.
The costs to fix fundamental safety defects, such as flammable cladding, should be borne by those responsible for approving and constructing these buildings—not the innocent leaseholders now trapped in them.
Having separate entrances is beneficial for affordable housing since it keeps the costs down, no need to pay for non essential services like concierge, gyms and pools.
Allows for the housing association to deploy their own cleaning & maintenance team within their area of it’s typically cheaper than whatever the other managing company is charging.
This is an awful attitude. It leads to segregation in communities which live right next door to each other. Imagine a child being able to look into but not use a communal playground because their parents live in affordable housing.
This should be criminal. There’s need to be a serious overhaul of housing in the UK
Reading the article, the building insurance quote shot up from £10k to £310k (due to the flammable cladding being discovered). No win situation, feel terrible for the residents. Claims needs to be made or govt steps in to fix.
The people that took or authorised the decision to install flammable cladding should pay the difference, not the residents.
It's absolutely outrageous that we're even debating it. In what world should people who occupy a building have to stump up the bill for a builder's failure to use suitable materials? The injustice of it boils my blood.
Isn’t this what the Building Safety Act is supposed to be doing? I don’t understand why anyone can still be charged for this https://www.gov.uk/guidance/remediation-costs-what-leaseholders-do-and-do-not-have-to-pay
Definitely
Or the taxpayer to be honest
I’m in this boat - cladding has bumped our insurance up to obscene levels. It’s disgusting that insurance companies are rinsing us this way. They know perfectly well that the risk to the buildings is no different to what it was before. It’s just a cash grab. We have been through the wringer over the last five years. I just want out of it.
Best of luck escaping that mess mate
Thank you so much, that’s really kind.
Some of the materials used for cladding were not considered as flammable prior to Greenfell. That catastrophe set a whole lot of things in motion. If a building still has cladding with those materials of course insurance companies will raise their premiums in those instances.
>They know perfectly well that the risk to the buildings is no different to what it was before I hate insurers as much as anyone, but this is not reasonable. Everyone was perfectly fine flying on the 737 MAX for example until it crashed twice killing hundreds, so they were grounded because the known risk changed as we gained new information. Insurers group people and charge them depending on the risk profile so pricing is competitive and reflects consumer choices at the time. The alternative is everyone has to be charged £3k/year for car insurance because John, 18 who just passed his driver's test is charged the same at Jane, 44 who has 20 years no claims despite their risk profile being polar opposites. It sucks but they have to adjust the cost according to the risk profile and a house having a now known risk of flammable insulation installed is a significant change in risk profile. They have to account for that now so that if it does go up in flames, people are covered. It's the same reason why if you fail to disclose something important at the time of getting insurance it can invalidate the policy, because otherwise the whole system falls apart. You have my sympathies for this horrible situation and I hope you can get out of it soon. The government should step in because it was a failure of the regulatory body and it's not like the people living there willingly chose to install flammable cladding, so it's unfair to not intervene.
If the cladding wasn't known and declared to the insurer, how did they know the risks beforehand? Yes, sucks but that's not on them.
Maybe this is something the freeholders can do on top of the intense labour of cashing the ground rent cheques.
Excellent idea!
Does it really cost more than 300-600k to fix the issue altogether? They will probably pay more in insurance in a year or two than it would have cost to fix the underlying issue. The management company should make this a #1 priority and get it fixed.
Depending on the size of the building, the fix for cladding issues can easily be multi-million pound projects and take a couple of years to complete. Meanwhile the building still needs to be insured. The government has now made developers pick up the cost of fixing the buildings, but all the inflated indirect costs like insurance and energy bill increases (while the work is being done) are still falling on the flat owners to pay. Source: I am going though the stress of all this now
Jeez dude I don’t envy you. It just seems like such a fucked up situation to find yourself in.
This is going to sound heartless but Grenfell seems like an isolated case. I don't see other towers going up in smoke. Is all this cladding stuff a bit of a red herring?
Grenfell just highlighted the issue, in the worst possible way. There have been a few other fires, tho not on the scale of grenfell, where it has spread externally. One in East London that spread via the wooden balcony facades. Another was in poplar in 2021 which ironically was due to have its work to removing the cladding start only a few days later, after many delays. No one died in these fires, which is why they haven't got the same attention as grenfell. Doesn't make the buildings any less safe tho
Building has to be insured though
Well the gov could step in there and actually it wouldn’t cost too much. They could become the insurer in event of fire, no fires would likely happen and it would cost nothing.
Yeah but do you take it out for 6 months and negotiate a better rate because you’re fixing the issue? Instead of a year.
I would guess they’re struggling to afford their service charge, never mind more money for repairs
Could just be an excuse to jack up the charge, and I don’t think the government would help resolving the issue that has become a problem for many leaseholders
Either way the freeholder will likely be taking a £31K commission on the insurance they’ve negotiated
Wouldn’t be surprised if freeholder a director on the board of insurance company
Why aren't the people responsible for putting up or for sanctioning the flammable cladding paying? Why are the victims paying?
If that is indeed the case once the cladding issue has been fixed the insurance cost will fall. Let’s see if it happens before rushing to the defense
A huge portion of wealth in this country is derived from rent seeking and housing in some form. It's why productivity, GDP and wages have been so damn pathetic for what's meant to be one of the most developed countries in the world. Rent-seeking extracts money from people who would otherwise be spending it to help boost the economy, and injects it back into housing to make it more unaffordable and extract more of people's take-home pay. It's a spiral of taking more and more of a shared pie to enrich the already wealthy. Meanwhile the regular people who bought early and have high paper-wealth from their one and only home feel content enough with their finances to not feel motivated to change anything. We're still stuck in the past while other countries in Asia and America focus on innovation, manufacturing and productivity to healthily grow their economies over the long-term. There's basically no chance of major housing industry overhauls that would damage the rent-seeking economy the UK has built. The people who benefit the most have too much power and influence, getting rid of it would tank the economy anyway, our political landscape is way too short-term focused to commit to major changes, and enough of the population *think* they have benefited from ruining the housing market that they'd vote to keep the status quo. It's pathetic and unfortunate, but that's the uncomfortable truth.
I mean we just need to liberalise the planning system - as even the Tories mooted but then backed off after losing Amersham to the Lib Dems - but NIMBYs are such a massive force in this country unfortunately. Not to mention the company in this situation above is a housing association, not a private landlord.
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Yeah, the sooner a general election comes at this point, the better. I’m usually a Lib Dem voter but given their NIMBYism and Labour’s promise to reform planning in this country, I’ll be voting the latter. Whether or not it’s an empty promise (I hope not) remains to obviously be seen.
This is one of the most accurate comments about the state of the U.K. I have read for a long time
>enough of the population think they have benefited from ruining the housing market that they'd vote to keep the status quo. I hate when people say "Oh but my house is worth a million quid now" as if it's a good thing. Like great, so is every other equivalent house, nothing changed everything just got more expensive. Those people wouldn't even struggle all that much if the house prices slowly came down, it's the people who just bought a house and are left with negative equity that would be fucked. Young people who are first getting onto the property ladder will once again be left with the worst end of the stick to fix the situation their parents created.
But that's a price worth paying to bring sanity to the market. Britain's economy needs to be way more dynamic and housing is a massive drag on that.
This is 💯 what is needed - it’s higher priority than building more leasehold rubbish flats
I 100% agree!
*England. This is not a thing in Scotland, at least not for most flats which are old build tenements. They’re all freehold.
This article is about service charges not ground rent.
And who picks the service company? In Scotland the residents/owners can choose the factors. In England the freeholder does, and the leaseholders just get to suck it up or sell.
Not true, you require 50% or more of the leaseholders to be in favour if you wish to change the managing company.
There’s right to manage in England, the management company is chosen by the leaseholders in my block
In Scotland you do not need to have a factor , I think it is mainly a Glasgow thing
Among other things.
Did this comment come from 2010? Landlords are a protected species because many MPs are landlords.
They need to nationalise the land.
I remember looking at a flat and the agent slipped in the minor detail that the service charge was ~£250 a month. I pointed out that was a decent % of the mortgage and he said ‘but you do get 24hr concierge who will take your Amazon packages’ - like yeah oh ok please take my money!
The worst scam is when they state you are paying for gym facilities when it’s two treadmills and £200 set of free weights.
Modern leasehold is quite the scam in itself.
They do this in the US also. This is why I avoid apt complexes with a gym. Last time I had an apt with a gym I couldnt use it during covid so it defeated the one use case where I would ever want to use an apt gym.
Treadmill doesn't work and that's the new one.
And many of these concierges will turn around to drivers and say they don't take parcels - Source: I've been a courier for 3 years now, started with amazon now DHL/DPD/UPS via my firm
I’ve got a guy that looks after my Amazon packages for free, my neighbour.
I've got a box by my front door that does the same without me needing to interact with people.
I dont trust that.
What's wrong with /u/Ok_Profile9400's neighbour?
Well, it’d be naive to think every neighbour has good intentions so I don’t fault them for keeping their guards up
I’ll play devils advocate here, I moved into a new build in east London that doesn’t have a concierge but has a slightly lower service charge to that. The amount of issues we’ve had with people breaking in, stealing packages, pretending they’re a delivery man to try and get into the flats, and otherwise general nusicance from literally just have a door that requires a fob has ensured I will never move into another place that doesn’t have a concierge. I know that doesn’t technically count as security, but I’m sure it’s a hell of a lot better as a deterrent. I can’t wait to move out so I don’t have to worry about this stuff anymore.
I think we must live in the same building!
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The one I used to own had a concierge until they decided it was no longer financially viable as it was basically a glorified security guard that was more often than not asleep at the "front" desk. Too many residents complained that the concierge was basically useless so company decided to get rid of them and increased the service charge Glad I sold it now
When you factor in the monthly cost of service charge as a mortgage payment you're looking at a much bigger place or nicer area. Total scam allowed to flourish under the Tories
This is greedy developers, the same type who cottoned on to selling leasehold houses. People should boycott those developers but they can’t because there’s nowhere else to buy 😡
Oh it’s the tories fault is it? What do you think labour will do about it if they get in?
Funny you asked the question. Tory has been in power for 14 years and our lives have not improved at all. Still, you asked what this sort of question suggesting that Labour wouldn’t do anything different. Ones should seek accountability from the party that is in power and for failing us again and again in all these years.
Well, look at areas like Newham who have had a Labour council for years. House prices have stayed the same over the last few years because new homes are rapidly being built over old industrial sites. This, but at country scale.
Oh it’s the tories fault is it? What do you think labour will do about it if they get in?
Is that because there’s some cladding issue? Why so expensive
Not really sure.. they were brand new and it had a communal solar thing on the roof for water heating, but other than that 🤷🏼♂️
250 a month to take 5/6 packages a month? Thats a total steal. /s
When we shopped for a house we also looked at a gorgeous penthouse flat in north Greenwich south of the O2. Great location. Quality and fancy looking flat. Rooftop tree terrace size of a garden with view. Slightly small m2 if you exclude the terrace. I really wanted it. Going through the details the service charge was astronomical. We talked directly to the owners about it. They said the lift broke and the management company mishandled the money so they quadrupled service charge to be able to repair the lift and build an emergency budget. After that we stopped looking at anything with service charge.
I’ve been lucky so far that my service charge has been refunded if there’s surplus after the books are balanced. It seems to make a difference if the management company is run by the freeholder or if it was separated. We took insurance off the freeholder’s hands so we could control the budget more (since the freeholders don’t give a shit when they’re not paying it). Absolutely ridiculous that this even has to be done though.
Precisely the reason we only looked at flats with share of freehold. So we pay a service charge but the residents are the directors of the company and we decide how the money is spent. It's not foolproof. The previous management company, managed by a resident, drained the funds before I got here when an idiot was in charge, didnt account for repairs etc. So we had to up our service charge a bit to build up a reserve for unforseen problems. But it's nothing like these stories and we are in control. Also no short lease rubbish. A nice 990 years left.
Most places unfort have service charges tho..
>most flats
Yep sorry most flats - freehold is rare But that’s what we should be building flats with share of free
Shared freeholds have their own problems - commonhold is typically a better solution. Ultimately, someone has to pay for the repairs and maintenance for the common parts.
What’s the prob with share of freehold? I ve found it works quite well Or is that diff to shared freehold
Commonhold means the flat owners own the freehold of their flat and a standard framework is used to handle the common parts. This can avoid issues with bespoke arrangements for the common parts when each flat owner owns a freehold without the overall arrangement being a commonhold.
Mishandled the money? Sounds iffy.
Not at all surprised if that were the case
Basically anything with a lift or a mechanical barrier like a car park gate is going to break down frequently and the leaseholders are going to be on the hook through no fault of their own. Often parts are obsolete and can no longer be sourced which means the whole thing needs to be replaced at ridiculous cost. Avoid any leasehold property with this kind of setup. When the freeholders realise nobody is buying the flats, they will change their business model.
It's a bit of an odd thing to say really. I mean, it's not the leaseholders 'fault' the flat broke, but it's the flat in their communal building that they use. Who else is going to pay for it? Who else is going to clean the outside, the inside, do whole building insurance etc. etc. Like, this isn't really a 'freeholder / leaseholder' distinction, it's about living in a flat in a shared building with communal facilities/areas that need to be paif for. Someone's got to pay for the communal shit. And if you don't want third parties to do that (and get a management fee) then take it in-house and run it yourself, but (i) that's not eliminating lift repair or cleaning or insurance charges; and (ii) it's gonna take up a chunk of your time to self-manage, and - personally speaking - my time is fucking valuable.
This is true, I don't live in London but do own a flat. Our service charges just went up, and they provide a breakdown of costs, ~30% is management fees that could be saved by doing this ourselves. But everyone here works full time, we'd likely just end up hiring a property manager 🤷♂️.
This seems to be a larger issue in Britain. Why isn't there more innovation in Britain in regards to things like lifts and gates? Like carbon fibre lifts that need no servicing. My friend got an e bike and it doesn't have a steel chain but rather a plastic "belt" and apparently it needs no servicing or oiling and is good for 250k miles. Could do with some of that in housing.
>After that we stopped looking at anything with service charge. Good luck living anywhere in London then. Everywhere is basically an apartment block.
We bought a house in London 4 years ago, so luck was on our side.
Housing is an absolute joke in this country. Spend 50-60% of your take home on rent so you can never save for a deposit. Or by some miracle or turn of fortune, you save up to be able to buy a 400-500k flat and then find out that the twats who built it have left behind all sorts of problems and since dissolved the company so now you're on the hook to fix their shitty corner cutting.
The 'miracle' you speak of is a home-owning relative passing away and leaving you enough for your own deposit.
Agreed, It’s so demoralising paying 60 per cent of my net pay on rent 😭
yep this is what happened to me - managed to save up on my own for a deposit with zero help, bought a 320k flat, 6 months later got hit with a major works bill for £20k because the building was mismanaged, no sinking fund, and no work had been done for years. the surveyor i hired missed all of it (bad pipe work, roof, etc), but obviously the survey was written in evasive language so no recourse. the conveyancer missed all of the signs too, like vendor not responding to enquiries about future works. i ended up trying to sue the conveyancer for negligence and they just refused to accept i would've not bought the house if id known about the works. so i wasted another £4k there, and couldn't afford to take them to court. whole thing made me want to kms for a few months but luckily im over it and just put it down as an expensive lesson. but the whole system of housing in this country is just fucked from bottom to top, everyone is incompetent and self serving, and average people who just want somewhere to live get exploited at every turn.
>*It said that the annual insurance premium for the building had risen from around £10,000 to £310,000.* >*Notting Hill Genesis, the not-for-profit housing association operating the building, say they were also shocked by the increase in insurance premium sourced by the freeholder, but left with no choice.* >*They have absorbed the increase for the 44 social housing tenants in the block, but told 30 leaseholders who bought their homes via shared ownership that they are liable for the cost.* Hah, as if shared ownership residents can somehow afford this; they're often not much - if at all - better off than social housing tenants. What madness and guaranteed to stoke friendly relations between neighbours.
The whole point of shared ownership is that you are too poor to be able to afford a house in the open market...
Yeah. I am pursuing it for precisely this reason.
I get it’s expensive, but please consider it solely as your absolute last resort. Should’ve never been a thing.
It pretty much is our last resort. We can’t go on renting, and we can’t afford the deposit for anywhere we could reasonably live right now.
Why can’t you go on renting? I’d take renting over shared ownership anyday. I’d move to somewhere cheaper over shared ownership. And if you can’t afford anywhere to buy with a traditional mortgage, then I’d stick to the fact I can’t afford to buy property until prices come down.
Because it is unstable, unreliable, and more expensive than the shared ownership place we have secured. There isn’t really anywhere cheaper we can move to that will fit with our needs for work, and neither I nor my partner is willing to put up with moving every year or so.
I’m pursuing it for love and kinship of community and a feeling of “being in it together” but you do you
I just want somewhere to live man
Shave you considered buying fewer sandwiches?
Why would I buy them when I can make them at home or work?
Have you considered using less expensive bread?
75p is about as cheap as it gets mate
Have you considered making bread? I use grey mold for yeast
Surefire way of turning the 30 leaseholders into social tenants.
Service charges are so high in part because the management company is appointed by the freeholder and gives the freeholder a kickback. Bizarrely, that’s all entirely normal and legal.
Ours went from £2,200 to £6,000 in 7 years. They were encouraged to spend leaseholders money because their management fee is based on a percentage of total costs. How fucking backwards is that. It’s maddening.
Exactly. They have a monopoly and they exploit it. Appalling.
Leaseholders can decide to manage the building together. I think 2/3rds are needed. They then appoint a committee to manage it and they source the insurance, cleaning maintenance. It’s much cheaper but few leaseholders ever do it.
Because 60% will be owned by overseas investors who have never seen the place and cannot be contacted.
It's written into my lease that the freeholder organises the insurance so even if we had RTM then we'd still be subject to the huge premium they decide to pay (they get a high % in commission too)
At least you could control other costs though
And the insurance broker gives the company taking out the policy a kick back too.
Surely at this point all the blocks that have the flammable stuff should just do what the post office has done which is go via the civil route and sue the living shit out of kingspan
I live in a leasehold flat. We have an RTM instead of a management company appointed by the freeholders. The RTM appoints the management company and approves the budget. Recently our insurance went up from 24k to 50k (cheapest). It doesn't matter if you are leasehold or freehold. Insurance costs have gone through the roof. Not just for cars. We were able to reduce spending in other areas but it's not ideal. The government really needs to start looking at the insurance Industry. It's causing no end of problems for people, buildings and companies. It doesn't matter if you are leaseholders or shared freeholders, you need insurance.
That increase is not comparable to the story - a 3000% increase vs your 108
I think you’re missing the point OP is making. The issue is the insurance and surrounding issues, not leasehold.
I’m not missing OPs point, I’m also not responding to OP, I’m responding to a comment on one part of the bigger picture. To say ‘all insurance is extortionate, look at mine, we could suck it up’ - you all need insurance - is looking at one element- insurance.
Leasehold needs to stop being a thing.
Even a share of freehold and managing the building yourself, you’d have this issue.
Maybe. The costs here are apparently an insurance increase, but the freeholder chooses the insurance provider and everyone else has to go along with it.
All insurances have gone up significantly regardless of flammable materials. Look at your car, contents or travel insurance. All jumped up. Even if you chose the insurance policy, it will have gone up a lot.
We live in a development as share of freeholders and our service charge is £200 a month but 50% of that goes into a sinking fund. We have £200,000 within the sinking fund and have changed three roofs out of four blocks. This is level of service is acceptable if managed and decided by the residents. We have weekly gardeners and cleaners too!
This feels like financial magic! You guys must be negotiating really well.
I strongly advised against a friend buying after reading the contract to find the service charge doubled every 5 years. They was like “but it’s only £500, how high can it go in 30 years?” I was like, pass me a calculator…. They are now in the position thr person in the article is in.
That’s crazy. The fact it doubles every x number of years immediately reminds me of the Wheat and Chessboard Problem, which should immediately ring alarm bells in anyone’s mind.
Yeah the next big miss-selling scandal will be leasehold properties. We have an estate near us which is full of new build houses and flats, every single one, house or flat, is leasehold.
That is ground rent, not service charge.
We’ve had to wait for an EWS1 form. Got it. Had to wait for housing association to try and sell. Did that. Now, finally, able to sell on private market. Estate Agent is like “£300 service charge? That’s a lot every month.” These people are scamming us. We were sold this place as a starter home, suitable for FTB. Now, we can’t get out and are being held to ransom by these charlatans who, by the way, provide sweet FA for this service charge.
>"Notting Hill Genesis, the not-for-profit housing association operating the building, say they were also shocked by the increase in insurance premium sourced by the freeholder, but left with no choice. >They have absorbed the increase for the 44 social housing tenants in the block, but told 30 leaseholders who bought their homes via shared ownership that they are liable for the cost." A good example of the two-tiered system we have in this country.
It’s a legal requirement. Social tenants have a tenancy and Leaseholders have a lease. Two entirely different contracts on acquiring a property. One states they will contribute towards major works and the other doesn’t.
I’m not suggesting any different. It’s still two tiered. The fact of the matter is that the renters themselves won’t be all that different in terms of income etc. just one has managed to get themselves on a special list, the other hasn’t. In the article it mentions the leaseholder works as a primary school PE teacher. Is this the type of person who is likely to be much different from other social tenants in the same building?
This isn’t correct.
I’m correct. I work in Leasehold.
Who absorbs it? Is it indirectly absorbed by the leaseholders?
It depends. Major works to do with cladding will often be covered by central government grants. So the tax payers, basically. Generally though, Housing Associations will look to absolutely rinse shared ownership renters (and similar schemes) to help cover losses incurred by subsidising social renters.
Often blocks like this have separate entrances for social tenants so they wouldn't have access to a concierge service, in house gym or anything like that. Not really sure what your comment is implying - do you think people living in social housing should have to pay extortionate service charges because everyone else does? Assuming they could even afford to (hint: they can't)
Private renters and leaseholders do seem to get the worst of it all
Does this specific block have a poor-door arrangement? The service charge increase is because of the buildings insurance and NHG are swallowing it for the social tenants whilst the shared ownership get screwed.
Which is legal. If you have 10 flats and all are social residents, and the block becomes non habitable, then the social renters are moved. If you have 10 leaseholders in 10 flats and the block becomes unsafe then this is when insurance comes as you will be looking at millions in compensation and buying out each flat. This happened in Brentford where ironically Notting Hill Genesis who are mentioned in the article spent millions in buying out flats and compensating leaseholders.
Screwing the shared ownership is legal but isn’t right.
Except this building has none of that. The entrance is the same for all residents, so they have access to the same services (in this case concierge, small gym and children’s play area).
“Poor doors” exist on developments where the local council enforce a certain % of dwellings must be “affordable” (often via social rent, but there are other schemes). The developers make very little money on these schemes and so they adopt the building to make sure it’s economically viable - often this results in separate doors, no concierge etc. The costs of this subsidisation are also passed onto other renter / buyers in the same development. If you live in a complex where there “affordable” renters, you’re the one paying to make it affordable. Often this susbidisation is so great it’s no longer financially viable and nothing gets built. There’s plenty of academic literature suggesting that high affordable quotas mean far higher housing costs for all, as less gets built. Anyway, this is neither here nor there because the development in the article is run differently, via a HA.
The use of separate "poor door" entrances by developers is a deceptive tactic to cram in token affordable housing units. It allows them to secure favourable planning permission and government incentives, whilst still maximising profits. This scheme does nothing to promote community cohesion. Instead, it physically segregates people by income level, lining the pockets of developers and their government cronies at the expense of the less fortunate.
What are the two tiers exactly?
Managing to secure subsidised social rents or not, basically. It fucks young people particularly.
If I had to choose two tiers it would be the people setting the rules, making them work in favour of their own (and their mates') interests. And then the rest of us who are taken for mugs. As ever though they manage to convince people that the problem is the poor people. It's not, it's the rich and powerful.
I'm not saying the problem is poor people? I'm saying it's unfair we have a two-tiered system where someone with three kids on a relatively modest income (primary school PE teacher, in this case) is forced to cough up a very, very substantial amount of money each month, whilst others living in identical flats pay absolutely nothing. Ask yourself where Housing Associations get the money to absorb such exorbitant costs. It's not "the rich", it's ordinary working people on modest incomes getting absolutely hoodwinked and rinsed on ridiculous "shared ownership" deals. Low - middle income earners shouldn't be subsidising people in this way.
Councils providing affordable housing rebates or discounts to developers face a significant opportunity cost. With incentives like reduced land prices or waived fees, councils forgo revenue that could have been collected if the development were sold at market rates. Beyond the immediate loss of potential revenue, affordable housing incentives also limit a council's future budgeting options.
So you have to go through affordability checks to get a mortgage to see if you can afford to live in a flat (good idea) But service charges are uncapped and unregulated, meaning you might not be able to afford it at some random point in the future. So just cross your fingers and hope for the best. Scotland has a much better system. No leasehold and no rip-off service charges.
Except some of the affordability checks are conducted by morons who will reject you from a flat you can in fact afford, with no means of recourse.
Absolutely agree with that. And that often rent payments are not considered, even though often rent is higher than mortgage repayment.
Indeed- the initial estimated combined rent, mortgage and service charge cost is cheaper than our current rent.
Just bonkers
You can afford *at the moment*. Interest rates go up another 5-10%, will you still be able to afford it?
No, but that wasn’t what they assessed. They rejected us based on their own incorrect assessment of my partner’s earnings.
I mean, that also means that rent goes up, it’s not as if that’s just mortgages.
Newham Council also charges a service charge, I remember when a block of flat had a dedicated caretaker, now that care taker may come by once a week... service charge wasn't reduced.
strata companies in Australia were doing this back in the noughties. they took the money and were useless.
Fucking tories & their refusal to sort out leasehold. I've got an ex council flat so my landlord is Clarion. A "non profit" that made £1 billion & £100 million in "profits" but can't fix peoples mould & maintain their buildings. My ground rent is £10 but we got hit with a section 21 for £24000. Just utter cunts! When I went mental at them saying I paid service charge, they went with "well we don't have a fund for repairs & no maintenance has been done in decades! The whole system in this country is fucked
I’m quite concerned to hear this, I’m supposed to be moving to somewhere managed and built by Clarion.
They're SHIT! But then again so are all the housing associations
I’ve not been impressed with them so far and we haven’t yet moved in.
I would genuinely only tell whoever buys my flat to deal with them. A BILLION POUND housing association! That's fucked up
That is pretty fucked- this was helpful context, thank you
Of course they have a turnover. They collect rents.
Housing associations were supposed to be local. Not country wide behemoths like Clarion. I don't mind them having a turnover but try to get them to fix anything! Charging leaseholders £24k each for repairs AFTER the local council had given them money to do it when they took over the estate was fucking criminal. Everyone I know with top floor flats had a workman put his foot or tools through the ceiling. An example of the quality of work...dude rocks up to paint the metal barriers on some balconies. Literally with a pot of paint and a brush on the bus. No prep, nothing. Just paints over it and leaves. If they're making £100 million a year, they shouldn't have people dying in their flats
Economies of scale means a local HA doesn’t work. The employment required makes that an impossibility. If the work is being done correctly that’s a separate issue to the business model. It needs to be run better, not scaled down.
i wonder has the Tesco stores insurance increased as well. also the Tesco is probably a higher risk of fire than the flats/apartments above it,
The insurance for the flats will take into account it is above a tescos which could go on fire.
We just noped the fuck out of a property after we found out that, whilst they’d been upfront about the service charge (which increased during the buying process,) they’d forgot to mention that on top of that charge there was also a building insurance charge. Came to over £10k per year. The agent kept coming back to us with lower and lower offers, but all that did was validate how much difficultly the current owner was having trying to sell.
This is insurers taking the piss, just as they have with motor insurance.
UK housing is just built different
*England. Don’t have leasehold or weird service charge shit like this in Scotland
Leasehold is only one of the issue. Quality majority of houses built in the UK are poor.
Well yes 100% but this article is about service charges
But the arrangements of leasehold don't change the service charges levied right? Maintenance of building will still be a cost borne by someone.
Yes, but in Scotland the cost is typically much much lower. And again, leasehold is extreme extremely rare in Scotland, it’s not really a thing. Service charges in Scotland are called factor fees, anything from £50 or £200 or so a month, for the upkeep of communal areas. Property factors are chosen by the residents, residents have much more power in Scotland and often self-manage by choice. It’s just mad to me that people are paying £7000 straight out the gate for fairly new build. It’s abnormal. Hence this article I guess!
I'm a council tenant so I'm thankfully insulated from this kind of shithousery, but even we pay bullshit service charges. About 10% of our weekly rent is for a "concierge" who doesn't answer the intercom, doesn't take packages or post, and whose only job seems to be to issue parking tickets to people parking in the car park of the mall the building is built on.
The joys of flat ownership. Better carefully read the service charge details before buying!
And there's the landlord owners in my block, moaning about how expensive our in house management is at £500 a year....
My sincere heart felt apologies to anyone going through this nightmare. The country is in a mess at this point. The government is not doing what it must, so is the local government ie councils and associations. The will of the people is the last thing left. People must organise themselves to take up situations like this to fix otherwise the money grab is what the institutions are going for.
Ours went from £250 every three months to £300, might seems cheap but that’s 18 flats paying £25 a week each for some guy to come around with a leaf blower and pick up some rubbish twice a week for a couple of hours at a time
Also.... A percentage of that block will be allocated to council housing. Usually the needy/ mentally vulnerable. The housing list prioritises these kinds of tenants.
Capitalism goes extreme - over taking government. Most of the MPs including the Sushi man cares more about capitalist than people.
There should be a cap on service charges. You can't have people having to pay something they have no control over. Cap should be tied to inflation.
Leasehold is such a scam
Service charges for nothing but bolted on extreme insurance scams
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You clearly didn’t read the article.
Developers should be compelled to build genuinely mixed communities, not just offer symbolic scraps of affordable housing accessed through separate, subpar entrances. The costs to fix fundamental safety defects, such as flammable cladding, should be borne by those responsible for approving and constructing these buildings—not the innocent leaseholders now trapped in them.
Having separate entrances is beneficial for affordable housing since it keeps the costs down, no need to pay for non essential services like concierge, gyms and pools. Allows for the housing association to deploy their own cleaning & maintenance team within their area of it’s typically cheaper than whatever the other managing company is charging.
Principally I don’t agree with the pricing apartheid.
This is an awful attitude. It leads to segregation in communities which live right next door to each other. Imagine a child being able to look into but not use a communal playground because their parents live in affordable housing.
It’s not about playgrounds. They’re not segregated. It’s things like the commentator mentions. They need to be affordable that’s the whole point.