BBC News
Launch consoleBBC NEWS CHANNEL
Page last updated at 14:04 GMT, Saturday, 7 June 2008 15:04 UK

Repairs could cost owners' homes

By Bob Howard
BBC Radio 4's Money Box

Karen Buck MP
Many of Karen Buck's constituents are affected by the issue

A government scheme to bring social housing up to reasonable standards could leave some people homeless, warns one MP.

Hundreds of people who bought former council flats in England are receiving bills for thousands of pounds for repairs they say they cannot afford.

The work is being carried out as part of the Decent Homes initiative.

The government says it recognises the problem and has put a range of measures in place to deal with it.

Unexpected cost

Agim Sekiraqa bought his flat in the Polesworth House tower block in the London borough of Westminster in 2003 for about 40,000.

The consequences are they will lose their homes
Karen Buck, Labour MP

The block is being extensively renovated, and as a leaseholder he is now liable for his share of the 6m cost.

That is now estimated at 58,000, about three times Mr Sekiraqa's annual household income.

He has been given three years to pay, but he told BBC Radio 4's Money Box programme that he cannot afford to:

"We did not think that after a year or two they would come for a massive amount of money.

"We don't really know how we're going to afford to pay this much."

There is no affordable way to square the circle at the moment
Brian Johnson, CityWest Homes

In Hackney in East London other leaseholders are being pursued to pay for work which has already been completed.

Patrice bought her council flat on the Wenlock Barn Estate for 58,000 in 1998.

It has risen in value since then, but after improvements were carried out in 2006 she received a repair bill for about 24,000.

She says she is not able to borrow more money to pay it within the two year deadline:

"That's more than 12,000 per year plus interest: you're talking about a third of my salary.

"The only option for me was to sell my home."

Serious difficulties

Leaseholders have always been liable for repairs but it is the scale of improvements triggered by the Decent Homes Initiative which appears to have caught many leaseholders by surprise.

When you take on a property you take on the financial responsibility that goes with it
Paul Bird, Cambridge

Both Patrice's and Agim's bills came from bodies set up by government grants specifically to drive through this work on behalf of local councils.

Hackney Homes, which manages Patrice's property, and CityWest Homes which manages Agim's, both concede that some of their leaseholders face serious difficulties.

They say they offer a range of payment options and specific help to some, but admit they do not have the funds to help everyone.

Brian Johnson is chief executive of CityWest Homes:

"The funding we get from government is for us to provide a service for tenants.

"There is no affordable way to square the circle at the moment."

Any solution?

Karen Buck, Labour MP for Regents Park and Kensington North, knows many constituents who have been affected, including Agim who works in her office.

She says all the agencies involved need to get together to find a solution:

"We've got hundreds of people whose bills are 20,000, 30,000, 40,000, 50,000 and the consequences are they will lose their homes."

The Department for Communities and Local Government said the government has spent 23bn on improving social housing in England over the last 11 years.

It added owning a home carries responsibilities for its maintenance and said it is working with councils to offer a range of flexible payment options.

It also said homeowners could refer disputes to the Leasehold Valuation Tribunal.


BBC Radio 4's Money Box was broadcast on Saturday,
7 June 2008 at 1204 BST.



Money Box


SEARCH MONEY BOX:
 

Podcast

Download or subscribe to this programme's podcast

Podcast Help



SEE ALSO
External links and helplines
06 Jun 08 |  Moneybox
Have Your Say: Money Box, 7 June
07 Jun 08 |  Moneybox


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

banner watch listen bbc sport Americas Africa Europe Middle East South Asia Asia Pacific