Leaseholders of a south London apartment block say they are being forced to pay unbearably high service charges for a 24-hour concierge and garden used by their wealthy neighbours.
People living in a block of shared ownership flats at Viridian Apartments in Nine Elms have been locked in a dispute with their landlord Notting Hill Genesis (NHG) for more than a decade over the service charges, which have spiralled from around £100 for a two-bed flat to more than £500 a month since they moved in.
Residents told the Local Democracy Reporting Service (LDRS) the fees have become a “second mortgage” which, on top of rising rents and mortgage rates, are unbearable. They say monthly service charges were around £80 for a one-bed and £105 for a two-bed flat when they moved into the block, but they say they are now unfairly paying around £5,000 a year for a one-bed or £7,000 for a two-bed as they are being billed for services not included in their leases.
For the first few years of living in the block, which was built in 2008, residents say their service charges aligned with their leases – only including costs related to the block. However, in 2012, they were told their fees would rise to include the 24-hour concierge and maintenance of the communal garden used by the luxury blocks next door, which they could not access.
They say that while their leases show they do not have to pay these fees, supported by sales documents, the lease between NHG and the development’s management company – the superior landlord, which runs the estate – requires the housing association to pay these costs.
When this discrepancy was discovered in 2012, the management company began distributing the extra costs among leaseholders – with NHG collecting the higher service charges. Leaseholders have been disputing the charges since, maintaining that NHG’s “mistake” in signing a “bad deal” with the management company should not be passed onto them.
Their block is separate from the rest of the development with its own entrance, also known as a “poor door”, and they told the LDRS they were only given full access to the main entrance with the concierge leading into the communal garden late last year. They say this access is inconvenient as the development was not designed with this in mind and they ultimately do not want to use or pay for these services, in line with their leases.
Jennifer Docherty, 47, bought a two-bed flat in the block under a shared ownership agreement in 2008. She said her service charges have risen to around £7,000 a year, up from £1,200 when she moved in, and left her wishing she never bought the flat.
Jennifer told the LDRS: “[NHG has] a bad deal, but this is their job, this is what they do – if you made a mistake at that point in signing a bad lease, then you need to sort that out. It doesn’t mean you force the affordable housing people to pay… more service charges because of your mistake.”
She said NHG has made it difficult to challenge the service charges, resulting in 25 leaseholders taking it to the First Tier Tribunal in May. Their case is that NHG is only allowed to collect costs from them related to the block, according to their leases, which the housing association disputes.
The tribunal took place over two days as NHG filed a counterclaim to vary their leases, in the event the judge finds it has not been allowed to recover these fees so far. They are waiting for the judge’s decision in both cases.
Jennifer said the stress of the escalating service charges has only been compounded by NHG frustrating the relentless legal process, including by filing the counterclaim. “They really used this tactic to piggyback on our case and the issue with that is that it’s made our court case over £25,000,” she said. “It’s a cost-of-living crisis right now, our service charges are so high and now we’ve got this tribunal to pay for, which has ballooned into two cases.”
She said struggling leaseholders have been left with no choice but to pay the service charges in protest to avoid their homes being repossessed, leading to piling debt, while dealing with disrepair in the block’s communal hallways and stairwells. NHG said it is not responsible for these repairs, but it pushes the management company to complete them when they are raised.
Jennifer added: “We’ve had people break into our building, vandalise it, two residents were assaulted physically by people who broke in – so we’re paying for the concierge, but we’re getting vandalised and assaulted. It doesn’t make any sense.”
Janine, 45, who did not wish to provide her surname, moved into a two-bed flat in the block under a shared ownership agreement in 2009 and now pays more than £500 a month in service charges, when she originally paid around £100. She said the block was “designed for it to be affordable, but they’re not making it affordable, that’s the problem”, with leaseholders left owning a percentage of a flat which is “unsellable”.
Janine told the LDRS: “It’s just like a second mortgage, isn’t it? You just don’t spend on stuff you’d like to spend and instead you spend on the essentials.”
She added: “It’s money I was told I would never have to pay and I think in principle, on a contract, that’s what you expect.”
Janine feels NHG has not stood up for leaseholders or the values of affordable housing. She said: “I think the big issue I have with them is they’re not working with honesty and integrity, and I think when you’re under the social housing sector that should be key.”
She told the LDRS leaseholders hope to set a precedent through the tribunal to help other people in similar situations, adding: “Our goal really is long term. You want to A: be able to sell the flat and B: you want to make sure it’s affordable for what we actually get.”
Residents have set up a GoFundMe to raise money for their legal battle.
An NHG spokesperson told the LDRS: “Service charges at Viridian Apartments are set and apportioned by the leaseholder-run resident management company (RMC). They are also responsible for the running of the development, including access to and from the courtyard. We are assured by the RMC that all leaseholders who pay service charge towards the communal courtyard are given access via the concierge.
“We work with our leaseholders to push for repairs if they believe the resident management company have fallen short of their duty, but as tenants ourselves we have limited power to ensure this work is completed.
“We support the right of leaseholders to challenge service charges where they feel they are unfair or inaccurate, including taking their case to the First Tier Tribunal. We are awaiting the outcome of that case and will take on board its findings when they are published.”
The judge is expected to publish decisions on both cases in the coming weeks.
