Council leaseholders, those who exercised the right to buy or those who bought from them, have been facing very hefty major works charges, perhaps particularly in London. When repairs have been carried out alongside Decent Homes programmes, or as large scale works of roof and window replacement have gone ahead, major works charges per household of £20,000 or more have not been uncommon, with some reaching £40,000 or £50,000. While there have been successful challenges to these on occasion, those challenges are the exception.
The DCLG is now proposing to cap charges for repairs recoverable by Councils. The proposed cap is £10,000 (or £15,000 in London) over a 5 year period, where there is some Government funding to the COuncil for repairs and maintenance (eg, the remnants of Decent Homes, or any future funding). The consultation is here.
This would be a very significant cap. While it may well give some relief to hard pressed leaseholders, the obvious question is what would Councils do about required major works or completion of Decent Homes schemes if they are unable to recover a proportion of the costs from leaseholders (not just a delay – many councils have an installment scheme, but at all)? There is no suggestion of any alternative sources of funding opening up.
The suspicion is that there will be a great temptation to simply delay works, or not do them at all. And that may open up a whole fresh round of leaseholder litigation.