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Thursday, April 29, 2004

Watch out Greenwich, here comes Witho...


As promised, the letter I wrote to the council regarding the £16,000 of works...
The names have been changed to protect the innocent



Dear Council

Re: Proposed Works at [insert name of block], [insert name of road]

We are in receipt of your Statutory Notice of Estimates dated 8th April 2004 regarding the proposed works at [insert name of block], [insert name of road].

After reading your notice several times through disbelief, we feel compelled to respond to your request for observations. Our observations are clearly too lengthy to fit on the sheet provided, so we hope you will forgive us for detailing them in this alternative fashion. We also hope that you will take time to consider these observations very seriously.

Observations

1. Cost to the Leaseholder

Our first observation is in relation to the estimated cost to the Leaseholder of the works.

We understand that the Council has a responsibility to the Council tenants of [insert name of block] to ensure that the building and the individual tenanted properties are maintained to a satisfactory standard. We also understand that those who have chosen to purchase properties on the complex have a responsibility under the terms of their lease to contribute to such reasonable works as are necessary to the upkeep of the communal areas of the building and its structure.

However, it was with some astonishment that we noted that each leaseholder would be required to pay some £16,000 for these works. Knowing some of our fellow leaseholders at [insert name of block], it is clear to me that this kind of expenditure is way beyond their means. To put the situation in context, one of our neighbours (a pensioner, I might add) barely paid more than £16,000 for her property in the first place under the “Right to Buy” scheme.

You state that the Leaseholder can arrange to pay in 10 instalments. You and your colleagues may earn enough in excess of £1,600 a month to be able to afford such instalments, but I’ve no doubt that the majority of the leaseholders at [insert name of block] are not so privileged.

You also suggest that Leaseholders could arrange a bank loan. Whilst I expect some of them could, some of them may not even qualify for such a loan. This is also beside the point. The amount you are suggesting is not reasonable, taking into consideration all of the factors involved. The Leaseholders have not asked for these works to be carried out. They have received an unsolicited “bill” for a significant amount of money, a sum which most other homeowners would have to spend years saving up for before thinking of spending on their home. Homeowners should be able to choose when major works costing thousands of pounds are carried out to their property, other than emergency situations which would probably be covered by applicable insurance.

2. Works

Our second observation is in relation to the works themselves – how they benefit the Leaseholders and if it is justifiable to recharge them to the Leaseholders.

From earlier communications which have come to our attention, it originally seemed that the major focus of the works would be the replacement of the existing metal-framed windows with u-PVC replacement units. Having recently had work of this kind completed on a property of mine, we know that this should not cost in excess of £4,000 per property, and could cost as little as, say, £1,500. On looking more closely at the schedule of costs included with your recent letter (which, I might add, was not at all easy to decipher), it appeared that there were other works which contributed large chunks to the schedule, notably:

1. Rewiring of all flats
2. Concrete canopies
3. Replace timber door frames

In an earlier letter which was sent following the Residents’ Open Day, held in October 2003, it was stated regarding the rewiring (and I quote):

“This work will be carried out only where necessary within tenanted flats”

Thus, in our opinion, the £74,100 cost associated with this work should appear in the “Tenant” column, and not be rechargeable to the Leaseholders.

With regard to the work on the concrete canopies which represents some £25,000 – exactly how this work is of any benefit to the individual residents at [insert name of block] is quite beyond our comprehension.

In the table of observations from the previous notice of intention, it was noted that only the front doors of tenanted properties would be replaced. Does this mean that the item “Replace timber door frames” should also appear in the Tenant column of the schedule, and not be recharged to Leaseholders? Or do you intend to replace all door frames but not front doors? This requires considerable clarification.

3. Additional fees

Our third observation deals with the additional fees which appear on the schedule, i.e. the “supervision fee” and the “management fee”.

These add a significant amount to the total the Leaseholders would be required to pay, yet there is no explanation of what these fees are actually for and what service is provided in exchange for these extortionate fees.

4. Rechargeable costs

Our fourth observation concerns the “Rechargeable Block Cost”. You state in your letter (and I quote): “Not all of the works being carried out can be recharged to you under the terms of your lease”. This suggests to me that the Rechargeable costs should be lower than the calculated Block Cost, yet the “Rechargeable Block Cost” exceeds the “Block Cost” by some £34,000. I am afraid the logic of this escapes me. These seem to be accounted for by “Shared costs” yet there is no breakdown of what these costs are. This discrepancy requires a full explanation.

5. General Maintenance

Our fifth observation is more general. The fact that you are having to carry out works costing the best part of a million pounds rather suggests that the property has been neglected over the years, despite Leaseholders paying significant service and maintenance charges – supposedly for its upkeep.

Conclusion

It is clear to us that it is unreasonable to expect the Leaseholders to pay the amount quoted for these works. It is a major investment which, we believe, will not add enough value to the property to justify the expenditure.

By going ahead with these works as planned, you risk not recouping these costs, as the Leaseholders will simply not be able to raise the funds to pay the debts you will be forcing upon them.

On a purely personal level, we have recently put the property on the market at a price somewhat below the local average, due to its status as an ex-Local Authority property. This news will clearly make the property even less desirable and we shall likely have to drop our asking price further. It is even doubtful now that we will be able to sell the property at all once the would-be buyer discovers the extortionate bill with which they will be faced.

It seems to us that this situation does not seem to have been thought through with enough care. You must consider that you have a duty to Leaseholders as well as Council Tenants, and provide solutions which recognise the needs of all concerned.

Suggestions

Whilst it is easy for us to criticise, we do recognise that some of the works are necessary and we would like to put forward our own ideas which could make the situation more palatable for the Leaseholders:

  1. The work could be phased over a long period of time – e.g. focus the first phase on replacing the windows. This would make each phase of works at least vaguely affordable for the Leaseholders.

  2. Give Leaseholders the option of whether or not to have property specific works done (e.g. windows, rewiring, front doors).

  3. Provide a means of paying for the works over a significantly longer period of time – e.g. by increasing service charges


We would also suggest that the calculations are revisited to ensure that the Tenant Only works are excluded from the Rechargeable costs, as detailed earlier in this letter.

We would appreciate a full response to all the points we have raised, and hope to hear from you very soon.

Yours sincerely

The Big Fella (Leaseholder)
Witho (Official Hanger-On)


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