Residents win Curo service charge legal battle
People living in a block of flats take their landlord to tribunal over a 300 per cent increase.
Residents win Curo service charge legal battle
Alan Rice has helped residents in Weston concerned about their service charges
Residents in a block of flats have won a legal fight with their housing association after facing a service charge rise of more than 300 per cent.
Nine families in Weston-super-Mare, Somerset, saw their monthly payments climb from about £70 a month to more than £300 a month.
Housing provider Curo has now agreed to cap the charge at just over £100 after the case went to tribunal.
A Curo spokesperson said it had "already agreed these reductions before the tribunal took place".
Curo said: "What we're trying to avoid is large bills that leaseholders aren't expecting.
"Keeping people safe is our priority, and we need to balance ensuring the right fire safety measures are in place with trying to minimize the financial impact, which we know has been difficult."
Alan Rice from Weston Housing Action said the residents are "ecstatic".
"Quite a few people told us that we wouldn't win, but we were persistent and we got the result we wanted", he added.
The dispute concerned a property called Coombe Lodge.
It has nine flats, all of them shared ownership - a scheme intended to help people get onto the housing ladder by buying part of their property and paying rent to a landlord for the rest.
When the service charge increased, one resident said they had to take on an extra job, while others said they feared they would not be able to afford the higher fee.
Curo said the additional money was mainly to boost the block's sinking fund, which serves as a long-term savings account for building costs.
Rice said there was "some need" for a sinking fund, but that it was "devastating" for residents.
He said: "Although they were sold to them as affordable homes, suddenly they weren't affordable any more."
The residents will now be repaid the excess charges they have paid.
In response, Curo said "There are always maintenance costs linked to owning a flat in a block, and we completely understand that these can be a shock when significant work is needed.
"That's why there are sinking funds, which are like a 'savings account' for the whole building, to help flat owners spread the cost across several years."
The provider said it hoped it can "continue to work constructively with residents at Coombe Lodge to resolve all the remaining issues going forward".
There is no limit on how much a service charge can rise, but a law passed in 2024 should eventually require managing agents to provide a full breakdown of costs.
The Leasehold and Freehold Reform Act has yet to be fully implemented. It promises leaseholders clearer service charge bills, and the right to look back at service charge information over the past six years
Samantha Young lives in a Curo-managed block in Twerton in Bath
Samantha Young lives in a Curo-managed block in Twerton in Bath, and said she is going to take her case to the ombudsman after her annual service charge rose from £990 to more than £6,000, which she described as "astronomical."
"It is absolutely not affordable. This is higher than what you'd paid in zone one in London for flats with gyms and concierges.
"It quite frankly feels like we're receiving nothing."
Curo told the BBC it was "having ongoing conversations with Ms Young about how we can work together to resolve this, and we visited her at home this week to agree a way forward".