Service Charges: Tenants v. Leaseholders

What is included in the service charge and how is the service charge calculated?  These topics can be hugely complicated and there is a significant volume of law and tribunal hearings attributed to service charges.  We hope to provide an insight into some of the logistics and concepts involved.

This guide is also available as a PDF download.
 

Index
Summary
What the Service Charge is
What isn’t included in the Service Charge
How the Service Charges are calculated
Leaseholders
Tenants
Conclusions
Appendix: Camden Council briefing note
Tenant Service Charges
Leaseholder Service Charges
Appendix: More information about Leaseholder Service Charges
Appendix: More information about Camden Leaseholders’ Forum
 

Summary
This document aims to explain what is included in the service charge and to explain how the service charge is calculated. These topics can be hugely complicated and there is a significant volume of law and tribunal hearings attributed to service charges. We hope to provide an insight into some of the logistics and concepts involved.

The simplest explanation for the service charge is that it covers all the costs that Camden Council incurs in looking after the building containing the leasehold property and its surroundings. For a fuller breakdown please see later in this document.

Service charges are calculated differently for leaseholders and tenants; sometimes leaseholders pay more than tenants and sometimes vice versa. The reason for this is explored in greater detail throughout this guide.

Regardless of the law, the calculation methodologies do not have impact on whether the service provided is value for money or of good quality. That is an entirely separate debate!
 

What the Service Charge is
LEASE (the Leasehold Advisory Service) explains it very well: “Service charges are levied by landlords to recover the costs they incur in providing services to a dwelling. The way in which the service charge is organised is set out in the tenant’s lease or tenancy agreement. The charge normally covers the cost of such matters as general maintenance and repairs, insurance of the building and, where the services are provided, central heating, lifts, porterage, lighting and cleaning of common areas etc. The charges may also include the costs of management by the landlord or by a professional managing agent.” (Local authorities are not allowed to maintain a reserve fund, unlike private landlords).

“Details of what can and cannot be charged by the landlord and the proportion of the charge to be paid by the individual leaseholder will be set out in the lease. The landlord, or, sometimes, a management company that is party to the lease, provides the services, while the leaseholders pay for them. The landlord will generally make no financial contribution for the services, but sometimes he has to pay for the services before he can recover their costs.”
 

What isn’t included in the Service Charge
For leaseholders, the service charge should only cover the specific items mentioned in the lease (all of which are related to the property). This means that the Service Charge does not cover planning, transport, highways, police, fire, libraries, leisure/recreation, environmental health or trading standards. These are paid for via a combination of council tax, central government monies and self-raised income (e.g. fees for licenses, parking fines, etc).
 

How the Service Charges are calculated
Although both tenants and leaseholders pay service charges, each group’s service charges are calculated very differently:

Leaseholders
Most leases require that leaseholder can only be charged for works and services relating to the specific building and estate where the property is; the basic rule is that the terms of the lease set out what is to happen. But note that Camden are now in the process of pooling the management charge and accounting charge across all leaseholders and making individual leaseholders pay a share of the total, because its recent leases provide for this to be done.

Each March leaseholders are sent an estimated service charge for the forthcoming year (which runs April to March). This is based on the last known actual expenditure with an allowance for known changes in costs (e.g. inflation and changes in contract prices). Camden leases require that payments should be made against the estimated sum.
6 months after the end of the service charge “year” (i.e. September for Camden leaseholders), the actual costs are calculated and then an additional payment is required or a credit is given if the costs have not been as than expected.
 

Tenants
Camden Council calculates the service charge by reviewing the last known actual expenditure and then making an allowance for known changes in costs (e.g. inflation and changes in contract prices). This is done in March of each year and is effective in April. Correction to previous years’ estimated charges are also applied at this point, meaning that the calculation is never a simple straight forward percent increase.

There are three key differences in the calculation methodology:
1. The tenants’ service charges are not property specific. The total cost across the whole borough is taken and then divided by the number of properties, although tenants are not charged if they do not receive the service in question at all. This means that some tenants end up paying for services that they do not receive (and some tenants benefit from this!). The notable exception is full time concierge costs which are only applied to the blocks that benefit from this service. The elements that leaseholders’ have to pay for are set out in their leases.

2. Tenants have to pick up the cost for services included those that are provided to leaseholders but not covered in their lease, so not reclaimable from leaseholders. If tenants receive “additional” services, they will also pay for those services too in their service charge. The allocation of standard and additional services is for Camden Council to decide.

3. District Management Committees (DMCs) participate in the tenants’ Service Charge setting exercise. Tenants are consulted on increasing their Service Charge to pay for specific improvements but this is non-binding. The core amount is set by the Cabinet of Camden Council in the early part of each year, to be implemented in April.
 

Conclusions
Leaseholders and tenants’ service charges are calculated very differently, so there are areas of similarity and areas of divergence. Some services are specific to tenants and not leaseholders, and fewer to leaseholders and not tenants. Then, there are areas where some leases do not allow Camden to recover its costs, and others where the costs cannot be calculated easily.

The practical upshot of all of this is that leaseholder and tenants pay different amounts, but in the current financial climate Camden Council are trying reclaim more costs from leaseholders than they have done historically (c.f. the 2013/2014 Leasehold Valuation Tribunal on management charges). Camden Council’s aim is to get back all they spend on leasehold properties, given that a third of their housing portfolio is now leasehold, and that proportion is continually rising.
 

Appendix: Camden Council briefing note
The following briefing note was supplied by Camden Council in response to the Forum’s request clarifying the difference between leaseholders’ and tenants’ service charges.

Tenant Service Charges
The service charges to tenants are mainly at a standard rate. This means that for those tenants that receive a service the cost of that service is divided equally between them regardless of where their property is located. An exception to this is the charge for concierge services, which are specific to particular blocks.

Each year the proposed service charges are discussed at District Management Committee (DMC) meetings before being set. Each spring tenants are informed of their service charges for the forthcoming year.

Generally Camden calculates the total estimated cost of providing the services by reviewing the last known actual expenditure and adjusting for known and anticipated changes such as new contract prices. The expenditure that isn’t recoverable from leaseholders is then averaged across all those tenants who receive the service.

The actual income received from tenants and the actual costs of the service are reviewed each year. If the service charge income is enough to pay for all the services then this is taken into account when setting charges the following year.

If all the costs of a service are being recovered from service charges then we do not increase charges the following year. We do ask tenants (at the DMC meetings) for their views on increasing charges to pay for specific improvements.

If the actual expenditure incurred on a service was more than the estimated costs, then this would also be taken into account when calculating the following year’s charges.
 

Leaseholder Service Charges
The lease requires that leaseholders can only be charged for works or services relating specifically to the building and estate where their property is located.

Each spring leaseholders are sent an estimated service charge invoice for the forthcoming financial year. Generally Camden calculates the estimated charges by reviewing the last known actual expenditure and adding percentage uplift for the forthcoming year.

For example, the estimated caretaking costs for 2013/14 were calculated by adding 5.6% to the actual costs for 2011/12.

In September each year leaseholders are sent the actual adjustment for the previous year. So in September 2013 leaseholders will receive the actual adjustment for 2013/13.

Camden calculates the adjustment by determining the actual expenditure incurred for each service charge element and dividing the cost between all the residents who receive the service.

For example, the 2011/12 adjustment for caretaking costs was calculated by determining the hourly cost of the service. The hourly cost was then applied to each block/estate based on the number of hours service provided. [Camden Leaseholder Forum write: This is estimated; no actual measurements are made.]

Once the adjustments have been calculated for all the services provided, Camden compares this with the estimated amount billed at the beginning of the financial year. If the estimate was lower than the actual adjustment you are required to pay the additional amount. If the estimate was higher a credit is applied to your service charge account.
 

Appendix: More information about Leaseholder Service Charges
For more information about Leaseholder Service Charges please see the relevant section on the LEASE website.
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.

Complaining Effectively

This guide explains Camden Council’s official complaint process; its pros and cons; the best way to get a positive and relatively painless outcome and, in appendices at the end, a step by step guide to submitting a complaint online or an initial fault by telephone. Although written with the perspective of being a Leaseholder, the same process applies for all Camden Council’s services.

This guide is also available as a PDF download; it also has screenshots to help guide you through the online complaints process, which is referred to in the appendix.
 

Index
Why would you want to complain to Camden Council?
About the complaints process
Complaining effectively
Lastly
Appendix – How to use the online complaints form
Appendix – How to log an initial repair/fault by telephone
Appendix – More information about Camden Leaseholders’ Forum
 

Why would you want to complain to Camden Council?
Example: You’ve been discussing your issue with your Leaseholder Service Officer from Camden Council for many weeks (if not months) and you don’t feel you’re getting anywhere. You’ve told them you’re unhappy with the service and you want the matter escalated. Still it seems to make no difference. What can you do?

Answer: Complain! It often works and anything else (using your Councillor or going to the ombudsman) can only start after you have made a formal written complaint.
 

About the Complaints Process
Even though you may have used the word “complaint” in your conversations with Camden Council, your query will not get regarded as an official complaint unless you use the official complaints process.
• The complaints process ties up a number of extra resources (people!) and is expensive – all these costs get, eventually, passed back to leaseholders, so it is sensible to see if you can get the issue dealt with without wasting the time of unnecessary layers of management and other staff.
• If you complain too often and the complaints are rejected as unjustified, then you could be labelled as “vexatious” and all your future complaints will simply be ignored!!
• The complaints process is reasonably thorough; this means that the official complaints can take longer to answer than the usual response time.

TIP 1: Before making a complaint you are first advised to approach Contact Camden or Leaseholder Services (as appropriate). These are the areas within Camden Council that are specifically set up to be able to answer your query – if you don’t use these areas, then you are not likely to get a satisfactory response! On a good day these areas can get you answers very quickly; unfortunately we would agree that, for Camden Council, not every day is a good day. We usually only hear about the issues of bad service, but it would be fair to say that Camden Council deal with 100s of requests every day without incident.

TIP 2: If you are complaining about a housing repair, sometimes it is far quicker and easier to phone up Camden Repairs and give them the original repair number (which they can look up for you, if you don’t already have it) and let them know that the repair hasn’t been carried out effectively. They can immediately re-open the job and get investigating. Under Camden’s “Right First Time” repairs procedure, the amount of re-opened repairs do get logged and noticed (although this wouldn’t count as an official complaint). If there is no repair number, then it means the job was not logged on the system properly in the first place, which is probably why it has not been done!
 

Complaining effectively
Regardless of how frustrated you are, having come to this point in time where you feel you have been banging your head against a brick wall, the important thing to do is to take a step back and try and view your issue without emotion(!)

The Complaints Officer that deals with your complaint will have no idea what you are talking about, so you will have to explain everything – the better you write in to explain your situation, the better the officer will understand the issue and where you are coming from. You will need to explain:
• What you asked
• What happened
• What you are trying to achieve

1. Writing a history of the issue can be helpful. Sometimes, at this point, you may realise that what you asked and what you are trying to achieve are slightly different things (or have changed over time) – in that case go back and log a new enquiry! This time you will have more information, be on more solid ground and you might get the information or action you need.

2. When looking at the “What happened” question, you may realise that you don’t have any documentary evidence (photos, times and dates of calls, letters and/or emails, reference numbers that you were given). Again, here what you need to do is go back to the beginning and, if necessary, write or email in from scratch again.

TIP 3: If a council officer calls you to discuss your issue, do have the conversation but ask them to put the pertinent points in writing. Alternatively you can then email the Council Officer concerned and say “Thank you for our conversation. This is what I understand from it: XXX. If you feel that I have misunderstood please do write back to me within the next 10 working days.”

If there is no evidence, then Camden Complaints will dismiss your request. The Complaints department won’t regard the request as a complaint unless you have tried to go through the correct department/route/channel first.

3. If you do have documentary evidence, then you need to summarise it. If your evidence is too lengthy then your complaint may not be understood or a vital sentence may be missed!

Usually a page or two is enough for all of this; if you have an entire email trail, do feel free to refer to it, or include it as an appendix, but if you want to increase your chance of success, overloading a Complaints Officer with too much paper won’t help them get to the root cause of the problem and may just take up more time as they fail to understand the matter at hand. You can always include a line such as “More documentary evidence is available should you want it.”

4. Be reasonable and practical about what you want to achieve! Camden Council have set legal responsibilities (which they are obliged to meet) but other activities can be at their discretion.

5. If you do not think that Camden Council has resolved your issue then other options include: raising the issue with your local councillor, the First Tier Tribunal (Property Chamber – Residential Property) or the Local Government Ombudsman. We do not investigate individual complaints – please see the “About Us” section on our website for more details about our work.
 

Lastly
10 working days is generally agreed to be a reasonable time period for expecting a response from Camden Council on most topics. If you write in to Camden Council, do specify that you expect to hear from them within 10 working days (or otherwise ask them when they will be able to get back to you with an update) – this ensures that there are no misunderstands and expectations have been set on both sides. If a party (e.g. the Council) takes more than the agreed time, then going down the official Complaints route (after that) does tend to elicit a much better response!
 

Appendix – How to use the online complaints form
Screenshots accompanying this section are in the PDF version
TIP: Read this entire section before submitting your complaint online. It will make your life easier!

1. Read all the above!

2. Prepare all your summary in advance and save it as a Word file (or similar). If you wish to also send in a timeline, or more detailed evidence or both, prepare these as a Word document, PDF file or scanned image (but only in a popular format such as JPG) in advance and have them available on your computer.

3. Go to http://www.camden.gov.uk/complaint and then click “Make a complaint” further down the page

4. Page 1 is mainly about contact details.

• The complaint number is at the top where it says “Form reference” – this should come in useful should you ever want to speak to Camden Council and chase the progress of your complaint
• Put in your contact details as this will enable the Complaints Officer to contact you quickly and easily, potentially speeding up the handling of the complaint.
• Most Leaseholder enquiries belong to “Directorate: Housing and Community Care”
• In the “Your complaint is” box at the bottom, just put the summary of the issue – copy and paste it from your pre-prepared Word document. If you have used formatting and feel that this would make things easier for the Complaint Officer to understand, instead include a one or two sentence summary and write “Please see attached file which is the full summary of this complaint”.

5. Page 2 is just for attaching documents (such as the summary, if in word format, or any other scanned documentary evidence).

• Each file must be attached one at a time.
• Press browse and file the file on your PC, then click “open”/”ok” (or something similar)
• Once you have found your file click “upload”
• Each file must be attached one at a time
• Click “Proceed”

6. Page 3 is just for confirming that you are ready to file the complaint

• Put in your email address (again), as this ensures that you will receive a copy of the complaint form
• Read through the entire screen, as this shows the details of the complaint that will be submitted (including attached documents)
• When ready scroll to the top and click “Submit Form”

7. That’s it! You will then get an automated acknowledgement and a fuller response from the person that should have originally dealt with your query or the Complaint Officer within a calendar month.
 

Appendix – How to log an initial repair/fault by telephone
You may want to log an issue by telephone, well before getting to the “Complaints” stage. Here’s how to achieve the best possible result:

1. Call Contact Camden (020 7974 4444) and select the appropriate option from the menu.

2. Describe the problem and the person you are speaking to will give you a reference number.

3. On a notepad (not a bit of scrap paper, that may get lost!), write down:
• Time
• Date
Reference number (this is very important!)
• Name of the person you are speaking to
• Brief summary of the issue (so you don’t confuse it with any other issues that may occur!)
• Ask what will happen – e.g. how long the repair may take. If Contact Camden do not wish to suggest a time period, narrow the range down. e.g. “So, will it take a year”, and then narrow it down: “so will it take less than 6 months?”. This way you will eventually get an approximate idea of how long the issue will take to resolve.

N.B. You can also log an initial enquiry online and then, if nothing appears to be happening, phone Contact Camden with that reference number that you have seen at the end of the online submission process (and hopefully received by email too). When speaking to Contact Camden, quote the reference number and they should be able to look up your issue for you and tell you what the status is.
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.

Major Works (Heating Options/Appraisals)

Leaseholders regularly get notices from Camden Council about intended works. We have put together a briefing document regarding heating options, however we feel that the issues addressed in this document equally apply to lift renewals and other major works/appraisals.

This guide is also available as a PDF download.

Index
Summary
Background
Considerations
Method
Examples
Conclusion
Updates
Appendix: More information about Camden Leaseholders’ Forum
 

Summary
We understand that Camden has a responsibility to provide a heating system which will function satisfactorily both in the short-term and in the future. However:
1. Any system should be sustainable and energy efficient.
2. Any system should not be prohibitively costly to run – both in terms of fuel costs and maintenance costs.
3. Any works that take place should respect the architectural value of the estate and the existing principles of the external and internal design, establishing the principle of “like-for-like” replacement; for example, heating pipes under the floor, electrical wiring in the walls, etc as this is what residents have come to understand and enjoy within their homes.
4. Homes should not be damaged or defaced internally by the proposals with surface-mounted pipework or boxing-out on walls or ceilings; existing features such as floor to ceiling doors should not be interrupted or cut-into; there should be no loss of valuable storage space.
5. No estate should be damaged or defaced externally by the proposal, with surface-mounted pipework or flues expelling through walls.
6. The proposals should respect and be in keeping with the qualities of any Conservation Area. Existing examples of poor or insensitive infrastructure installation should not be used as a precedent for sub-standard proposed works. Indeed the rationalisation and amelioration of any such poor works should be considered as part of any proposal.
7. Any works should provide a detailed design for each individual dwelling, based on a survey of all properties to provide an assessment of practicability in terms of constraints posed by existing units.
8. Any works should ensure adequate zoning and isolation to provide ease of maintenance in the future.
9. Any works should be well planned before works begin, with good project management and tight control of quality of workmanship and cost throughout.
10. A proactive maintenance regime should be put in place as part of any proposal, with money set aside for this purpose.
 

Background
Camden’s commissioning of Options Appraisals starts from the premise that existing heating systems are over 30 years old and therefore in need of total renewal.

Proposals under discussion relating to the heating systems have the potential to affect thousands of homes. We would like Camden Council to acknowledge that these proposals represent a considerable and complex piece of infrastructural work that will profoundly affect all residents – and as such will require careful and thorough consultation and analysis. The majority of residents value the physical and social fabric of their communities, and would be willing to commit their time and energy to liaise with Camden Council in order to inform the proposals.

Camden Council has an obligation to ensure that the heating systems they propose will sustain and improve the physical and social well-being of their properties – and at the very least have no negative impact upon them. The Council also has a duty to consult with all residents, listen to their views, act on their wishes and keep them informed of progress in a timely fashion.
 

Considerations
The ethos behind the appraisals methodology must be challenged on every occasion as it is not based on any legal requirement and is not cast in stone. The appraisal is not designed to examine the present system with a view to improving the service, which might well be possible with partial replacement of e.g. radiators, valves, boilers, etc or a flush out of the system. No consideration is given to retaining and upgrading, if necessary, the system. Camden Council say their decision is also based on the number of call outs/breakdowns, but appear unable to back up these figures with any mitigating circumstances – such as the fact that on occasions we understand the Council saw fit to operate an entire system with only 1 of 3 boilers working. There can be 100 reports of one fault in the heating system affecting a number of residents. Each report is counted as a separate complaint despite the fact that there is only one fault, reported 100 times. The Council should not use these statistics to substantiate their claim that an entire new system is needed, without providing full details of the circumstances behind these statistics.

Tenders should not be sought until all homes have been surveyed, otherwise variation costs will be extremely high. We are aware that contracts have been tendered, with only a very few units surveyed. This meant that Camden Council has used diagrammatic layout plans, and not plans which show actual layouts.
 

Method
Camden Council should identify the team that will be developing and implementing their proposals and establish effective means for this team to communicate and consult with residents. We feel that it is essential that this team should have the required technical expertise and decision-making power. Local knowledge such as that provided by caretakers or others with a good knowledge of the estates should be welcomed and utilised.

The Council should ensure that residents’ suggestions and requirements are at the heart of any proposal and that residents will have a real say in deciding the best way forward for their heating system. Residents can request a breakdown of the consultation process and how queries/observations were taken into consideration.

Camden Council should demonstrate a detailed understanding of the functioning and make-up of the existing system and its component parts explaining how the existing system has been designed to be fit for purpose. A thorough analysis of breakdown data and maintenance records with a detailed and specific analysis of the cause and location of failures should be provided. Drawings / diagrams and thorough written explanations should be used to illustrate this clearly to residents. This evidence should be used as the starting point for any proposals for the system and if not forthcoming, can be requested under the Freedom of Information Act from Camden Council.

Camden Council should assess what parts of the system and installations could be retained and what installations would need to be replaced and provide an assessment of how any liability issues at the junctions between the two would be covered. For example, degraded steel distribution pipework could be replaced along with radiators/valves if necessary while the longer-lasting and anecdotally less-corroded copper pipework could be retained.

Residents are within their rights to request that no work is undertaken before any concerns (that the above process uncovers) are addressed. The most important thing to stress is that Camden Council must prove that the work is necessary. Other councils have had their charges nullified for undertaking unnecessary works (see full article about a 2012 case involving Islington Council here).
 

Examples
• In March 2013, on the Curnock Street Estate, there was a breakdown of the heating and hot water system which Camden council says that is aiming to fix this by the end of the next month. This meant that the residents will have been without adequate hot water for a total of three months – or of course it may take longer. These repairs are after the end of major heating works worth millions of pounds and countless repairs. The estate did not have water for 32 days in 2011 and 24 days in 2010. The Council’s employees are creating difficulties for themselves by not providing residents with relevant information about these issues.

• On the Whittington Estate, an Apollo worker told a resident that her heating problems were due to a leaseholder carrying out works to a unit within the same block. Not only is this divisive but it was untrue as there are no leaseholders within that particular block. An Apollo worker has previously blamed “a leaseholder carrying out works” for problems with the heating system, when it transpired that the true cause was due to defective pumps/valves letting air into the system.

Another resident was without heating for over 3 weeks and Apollo blamed the age of the system and complete blockage of the pipe work/radiators within the unit. The actual cause was an Apollo operative having “adjusted” the riser so it was OFF and it had been left turned off.

• At Kiln Place, the new heating system is not only more expensive and more inconvenient for residents to run but it is also is not working as it should, temperatures being inconsistent between different floors in duplex (two-floored) flats.

During a Leasehold Valuation Tribunal (LVT) case, relating to the above work in Kiln Place, it decided that, according the respondents’ leases, Camden Council did not have the power to insist on the replacement of the hot water systems in individual flats (only central heating systems); this was after 99% of the estate had had their systems replaced. The LVT also ruled that Camden Council had failed to fully consult in regards to the cost of installing heat meters for Kiln Place estate – the cost was 50% of the overall package, so this particular element should have been consulted on in detail. Case reference and clickable link: LON/00AG/LSC/2011/0522.
 

Conclusion
We understand that Camden is now considering allowing residents to opt for individual boilers and that this strategy may enable leaseholders/freeholders to install their own systems within their homes. It is essential that the detailed practical implications of individual boiler installations are thought through and workable solutions identified before residents are asked to indicate their preferences.

It is essential that strategy for providing the necessary flues is identified that will avoid damaging or defacing the external appearance of the existing buildings, and avoid negatively impacting on air quality. Through-wall flue outlets from each dwelling could be unsightly and impractical and if in a Conservation area would be unacceptable.
The ramifications of the gas installation and new requirements and best practice should be assessed in detail as there can be safety and aesthetic considerations relating to gas pipework.

Any Options Appraisal must be scrutinised by residents and errors of fact highlighted.

It is not satisfactory for errors to be picked up once work is in progress. By then, it is too late.
 

Updates
• In September 2013, Councillor Julian Fulbrook, the then–current Cabinet member for Housing on Camden Council, announced that at a Leaseholders’ Forum meeting that community central heating would no longer be presumed during upgrade works and that individual boilers would be actively considered… specifically: “the gist is correct; we will not necessarily replace district heating systems with new district heating systems, but will consider the circumstances of each location.”

• The council’s latest heating and hot water policy can now be found online. Technically this August 2015 document is an “appraisal brief”; it lists the considerations the Council must go through before upgrading or replacing heating and hot water systems.  If you are currently undergoing such a scheme, then this is the document for you!
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.

Collective Enfranchisement (buying the freehold of your property)

This guide concerns buying the freehold of your property (“enfranchisement”).  We talk through some of the benefits and potential risks, explain who qualifies and outline the journey.

This guide is also available as a PDF download.
 

Index
Introduction
Why you might want to consider Enfranchisement
Why you might not want to consider Enfranchisement
Eligibility
Next steps
Further reading
Appendix: More information about Camden Leaseholders’ Forum
 

Introduction
Enfranchisement is the legal right of leaseholders to group together and buy up the freehold of the property, so they own shares in it and become the landlord (freeholder). A leaseholder who was previously paying service charges and capital works charges to Camden Council would pay them to the new owners who would be all the leaseholders including Camden Council which would have leases on any tenanted flats so the tenants would remain as before. Council tax would remain payable to Camden Council.

Some Camden Council leaseholders have the right to enfranchise. This guide explores this and associated considerations in more detail.
 

Why you might want to consider Enfranchisement
1. Responsibility for your own maintenance and building investment (potentially saving money) and allowing you far greater control and say over any issues.
2. Greater rights to develop the property, for your own benefit. Owning the freehold gives you greater control over proposed modifications to the building.
3. Lower management charges. As a freeholder, you save this money if you manage the property yourselves, or have more control over the property managers who now work for you.
4. To make it more attractive when you want to sell a flat (the psychological benefit of having a flat with share of freehold).
5. The (new) owners can decide to extend or change leases, but they have to balance any such proposal against the need to get sufficient funds to maintain the building.
 

Why you might not want to consider Enfranchisement
1. Responsibility for your own maintenance and building investment (which typically involves liaising and agreeing with your neighbours on a regular basis)
2. Legal costs involved in the enfranchisement process (such as solicitors)
3. The work involved in shepherding the enfranchisement process along
4. Your building doesn’t meet the eligibility criteria
 

Eligibility
Eligibility is based on the type of property. The criteria are:
1. At least two flats in the property.

2. At least half of the flats let to qualifying tenants such as those granted under the “right to buy” or “right to acquire on rent to mortgage terms” (which applies to the majority of Camden Council leaseholders; a shared ownership lease where the tenant’s share is 100% is also ok) and two thirds of the flats must have a lease length in excess of 21 years.

3. But, even if the tenant satisfies the above criteria, they will not be a qualifying tenant if any of the following cases apply:
a. the tenant owns more than two flats in the building. This is either jointly with others or solely in their own name. Please note where this applies these flats will be discounted from the two-thirds
b. the tenant has a business or commercial lease
c. if more than 25% of the internal floor area of the building, excluding any common parts, is neither used or intended to be used for residential purposes then the building will not qualify. This could be shops, offices etc. Please note garages and parking spaces specifically used by flats in the building are classed as residential for the purposes of this check.

4. There is no right of collective enfranchisement where the freehold includes any track of an operational railway, including a bridge or tunnel or a retaining wall to a railway track.

A full eligibility guide is available on the Leasehold Advisory Service’s website, including some criteria and exemptions that do not apply to Camden Council leasehold properties.
 

Next steps
Once the eligibility has been sorted out, then the real work begins.

The basic process is as follows:
1. Organising for Enfranchisement
2. Choosing the Nominee Purchaser
3. Selecting and Instructing professional advisers (solicitors and surveyors)
4. Assessing the Purchase Price
5. Serving the Initial Notice
6. Preparing for the subsequent procedures

The Leasehold Advisory Service has an excellent guide for the remaining steps but you will probably find it useful to get legal advice to help you along the way.
 

Further reading
This is a highly complex area with important considerations and implications. This document has only summarised some of the main issues.

Sources of information for this article and potential sources of further information are as follows: these links go directly to the relevant pages of the websites
Leasehold Advisory Service
Leasehold Guidance Service from the Ringley Group whilst the guidance provided by the Ringley Group is helpful, we have not verified their service and therefore we provide no endorsement for any (paid for) services that they provide.
Camden Council
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.

Lease Buy Back

Our fully revised guide explores the options that leaseholders have in surrendering their lease to Camden Council. It is also available as a PDF download, which you may find easier to read as the formatting is better!

There are two core reasons that Camden Council may buy back your property lease:

Regeneration: This is when an area is having a major development to improve the quality of the housing stock and local amenities. This may involve demolition of your property. Lease buy back, in this situation, can be compulsory.

Discretionary Buy Back: This is designed for leaseholders who can no longer afford owner occupation or whose circumstances mean that owner occupation is no longer suitable.
 

Index
Regeneration Buy Back
Key features
Process
Discretionary Buy Back
Key features
Further Information
Appendix 1: About Camden Leaseholders’ Forum
Appendix 2: Regeneration Buy Back Example Costings
Appendix 3: Regeneration Buy Back (Camden Council document, 30th May 2013)
Appendix 4: Discretionary Buy Back (Camden Council document, 30th May 2013)
 

Regeneration Buy Back
Opinion: Why does Camden Council not rehouse residents in the new replacement properties on a like for like basis?
Camden Council’s current position is that they have a legal duty to maximum their revenue; so if a leaseholder forced out from a property worth £350,000 and then the replacement property is worth £500,000 then Camden Council cannot, in effect, forego £150,000 of lost income.

We disagree with the principles involved in the above statement and continues to pursue legal advice to obtain a fair and equitable solution for all concerned. This is especially true where, in the typical context, a regeneration may lead to a site that had 90 properties originally being replaced with a site of 275 properties (as is planned in the Bacton redevelopment), meaning that Camden Council will make a significant profit on the additional properties that are due to be sold on the open market.
 

Regeneration Buy Back: Key features
– Negotiated settlement with Camden Council on an individual basis, based on your circumstances
– Camden Council will give you the following choices: (a) “market price” + 10% compensation + legal costs, removal costs and other reasonable expenses; (b) shared ownership in the new replacement building; (c) rehousing in an equivalent property (if available)
– If negotiations with Camden Council fail then Camden Council can apply for a compulsory purchase order
 

Regeneration Buy Back: Process
1. Market valuation of the property
2. Homeloss payment (for distress and inconvenience; typically 10% of market value)
3. Disturbance payments (for the expenses involved in moving properties)
4. Acceptance of Council’s offer
5. Completion formalities
 

Discretionary Buy Back: Key features
– Property Buy Back is at Camden Council and the leaseholder’s mutual agreement
– The maximum value is usually 25% of the market rate for the property
– You can remain in the property if you agree to be a council tenant, renting the property instead
 

Further Information
– For more details on Shared Ownership please see: https://www.gov.uk/affordable-home-ownership-schemes/shared-ownership-schemes
– For more detail on Compulsory Purchase Orders please see: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/11487/147639.pdf
– For more Camden Council’s notes on Regeneration Buy Back please see Appendix 1.
– For example costings regarding Regeneration Buy Back please see Appendix 2.
– For more Camden Council’s notes on Discretionary Buy Back please see Appendix 3.
 

Appendix 1: About Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.
 

Appendix 2: Regeneration Buy Back Example Costings
These are theoretical figures to understand what compensation and cost is involved for the less of your main property. e.g. a three bedroom property in Ludham. The full breakdown can be found in the next Appendix (which is the official position from Camden Council).

£350,000 Market value
£35,000 Homeloss compensation
(10% of market value, up to a maximum of £47,000)
£5,000 Disturbance payments (without any receipts/or actual expenses with full receipts, if greater than £5,000)
£390,000 TOTAL
 

Appendix 3: Regeneration Buy Back (Camden Council document, 30th May 2013)
The first stage in the negotiation process is for the Council to make a formal written offer which, is modelled on the statutory payment which would be recoverable if the Council were to exercise compulsory purchase powers and acquire the land. The heads of terms of the offer are detailed in 1-3, of this information sheet.

The Council offer will include:

(1) The Market Value
(2) Homeloss Payment
(3) Disturbance Compensation
(4) Acceptance of the Council’s Offer
(5) Instruction of Legal Services
(6) Exchange of Contracts
(7) Completion
(8) After Completion
 

(1) Market Value
The first stage is to arrange for the Council to visit your property and undertake a valuation.

If you would like your property to be valued, you can contact the Regeneration team to organise an internal valuation on 020 7974 3020. The valuation is undertaken by the Property Services department and will be undertaken by a qualified Surveyor. The valuation will be valid for 3 months from the date of issue.

Independent valuation: If you are unhappy with the Council valuation you can request an independent valuation be undertaken by the District Valuer. The final valuation of the property will be the District Valuer’s valuation and you cannot revert to the Council’s original valuation if this was higher.

Following the valuation, we will notify you of the valuation figure. The District valuation is final and the value of the property can of course go up or down or remain unchanged. The Council will pay the instruction costs for the District valuation.
 

(2) Homeloss Payment
The Homeloss payment is statutory compensation that you are entitled in recognition of the personal distress and inconvenience suffered from people who are displaced from their homes in respect of regeneration works. There are two types of payment:
– Homeloss payment for residential occupiers required to leave their home
– Basic Loss payment for Leaseholders not in occupation of the property

To be entitled to a Home loss payment you must have lawfully occupied the property as your principal residence for at least one year before the date of displacement.

The Homeloss payment compensation is reviewed annually for resident and non-resident Leaseholders and the present levels of payment have remained unchanged since 2008. Home Loss (Prescribed Amounts) Regulations 2008:

Residential Leaseholder (Homeloss payment)
Leaseholders in occupation of the property for a minimum of one year prior to the resolution to purchase are entitled to compensation for Homeloss payment at 10% of the value of the property to a maximum of £47,000.

Non-residential Leaseholders (Basic Loss payment)
Non-residential Leaseholders not in occupation of the property are entitled to a Basic Loss payment of 7.5% of the value of the property to a maximum of £75,000.
 

(3) Disturbance Payments
The disturbance allowance is intended to compensate the Leaseholder for costs incurred by displacement and the amount is intended to be equal to the reasonable expenses associated with the move.
The Disturbance Payment can be paid in two ways:-
1. A one off Payment of £5,000, without the need of Camden Council to review the receipts and invoices of costs that you incur.
2. Alternatively, if you have found a related purchase, the Council upon the submission of receipts/invoices refund the reasonable costs, which will cover:
– Disturbance Payments for removal costs
– Reasonable legal and Surveyor fees for the sale of your property and purchase of a new property if applicable
– Stamp Duty on a new property if bought within one year

Disturbance Payment for removal costs
The intention is to reimburse the Leaseholder for the reasonable costs incurred as a direct consequence of the move and is a natural and reasonable consequence of the move. Where possible, receipts and invoices will be requested.

Reasonable Legal and Surveyor costs
You will be required to provide a Statement of Costs from your instructed Solicitor, detailing legal fees and disbursements of a comparable property.

Stamp Duty
Stamp duty will be payable on the principal of equivalence, that is the owner should not be better off or (worse off) than before the regeneration proposals. In general the payment of Stamp Duty will be made on the basis where a new purchase is found (one year form the date of sale), the level of Stamp duty is paid on the grounds that the new property is not more than the market value of the sale. The Stamp duty will be payable on a replacement property if purchased in the United Kingdom, one year from the date of sale.

Assessment of Disturbance Costs
The actual eligible expenditure will vary from Leaseholder to Leaseholder depending on the individual’s circumstances.

Please note that the onus is on you to prove your loss rather than the Council to justify or identify your loss. You should keep all relevant documentary evidence such as receipts invoices and fees and quotes.
 

(4) Acceptance of the Council’s Offer
The Council’s offer will be valid for 3 months from the date of issue, if you wish to accept the Council’s offer you should do so in writing, either by post or e-mail. The acceptance should be signed by all owners of the property.
 

(5) Instruction of Legal Services
After acceptance of the Council’s offer, you will need to instruct a property Solicitor/ Conveyancer to look after the legal side of selling your home and act on your behalf.

You can find a Solicitor in your area that specialises in conveyancing, on the Law Society website.
 

(6) Exchange of Contracts
On exchange of Contracts the sale of the property will become legally binding, at this point all the Solicitors in the chain will exchange contacts. The Council will unable to provide you with a definite completion date until exchange of Contracts.

Deposit
All the agreed disturbance payments, valuation costs and market value will be included the Contract. If you are purchasing a related property, the Council will provide you with the required deposit for your next property, which will be deducted from the proceeds of the sale.

Arranging the Move
Once you have the completion date you can arrange to move. If you cannot get anyone to recommend a removal firm you can contact the British Association of Removers.

Service Charges and Capital Works
One of the conditions of the Contract is that is you should continue to pay your services charges and any arrears in Service charges. Any arrears in service charges and Capital work invoices will be deducted from completion monies, prior to the monies be transferred to your Solicitor.
 

(7) Completion
The remainder of completion monies less the deposit already paid on exchange of Contracts will follow upon completion. On completion the property will legally be transferred back into the ownership of the Council.

You should ensure that all items are removed from the property to avoid delay in completion of the sale, or being charged the cost of removal of items. The keys should be returned to the appropriate Neighbourhood Housing Officer.

Vacant Possession
One of the terms of the Contract will be the requirement to provide the Council with vacant possession. This includes ensuring that all your possessions are removed from the property.

Time scales
From the time that pre – contract negotiations and the disturbance payments are complete it is estimated that the conveyancing process will take 6-8 weeks.
 

(8) After Completion
Post
You can have your mail re-directed by the Post Office. This can be arranged by post, if you pick up a form at the post office, seven days’ notice is required. We strongly recommend that you request this service from the Post Office. Please note that the Council will accept no responsibility for collecting and forwarding of your mail to your new address.

Benefit Entitlements
Please note that it is your legal duty to declare when a payment is made to you to the necessary Council departments as this may effect your benefit entitlements.

Housing Options
If Leaseholders are suffering financial hardship or other difficult circumstances there is a discretionary scheme allowing Leaseholders to convert to a secure Council tenancy. Under this scheme the Council will pay 25% of the market value of the leasehold interest (the percentage is governed by statutory instrument and the percentages may change). See next Appendix for more details on this option. 
 

Appendix 4: Discretionary Buy Back (Camden Council document, 30th May 2013)
WHAT IS THE BUY BACK SCHEME?
Buy back is a scheme whereby under certain circumstances the council can purchase your leasehold or freehold property and in return offer you a secure tenancy within the same property.

DO I QUALIFY FOR BUY BACK?
Buy back is designed for leaseholders who can no longer afford owner occupation or whose circumstances mean that owner occupation is no longer suitable. The scheme is discretionary, there is no guarantee the council would be able to buy back your property and all parties would need to be in full agreement before such a buy back could take place. You should also be aware that the maximum the council could pay for your property would be in the region of 25% of the market value and this figure must also be enough to cover all outstanding debts secured against the property.

The main circumstances under which the council would consider buying back your property are as follows:
– You are experiencing severe financial difficulties and are in danger of having your property re-possessed.
– You have discussed debt repayment options with your bank or building society and investigated all alternative solutions to your financial difficulties.
– You want to remain living at the same property.
– You do not have an alternative residence (only in exceptional circumstances would the Council consider buying back when you do not live in your property, for example if you are an elderly leaseholder living in residential care).
 

THE BUY BACK PROCESS
Your initial approach should be by telephone where we will be able to discuss your specific circumstances and assess whether it would be in your interests to formally apply for buy back.

If your situation is appropriate, we will send you the relevant forms to complete in order to make an application. These will include an income assessment form, which will allow the council to assess your financial circumstances, and a council tenancy application form. We will also require evidence of any outstanding debts you have including service charge arrears and any mortgage(s) or separate loans you have secured against the property. You will be required to sign a disclosure form allowing the Council to contact your mortgage provider or if you have a solicitor acting on your behalf we will contact him/her for these details.
 

INSPECTION OF YOUR PROPERTY
The council will need to find out the condition of your property and to this end an officer from your local District Housing Office will arrange an appointment with you to visit and carry out an inspection.
 

COUNCIL DECIDES WHETHER TO CONTINUE
The council will then assess your application before deciding whether to continue on to the valuation stage. The circumstances of each case are considered on their own particular merits but the council has limited funds and there is therefore no guarantee of acceptance. If your case is not accepted or if at any stage you decide to withdraw from the process, then please be aware that the council will have an obligation to pursue any outstanding service charge debts you might have.
 

VALUATION
If your application is accepted then an officer from the council’s Property Services division will arrange to visit your property in order to carry out a valuation of the flat.
 

THE COUNCIL’S BUY BACK OFFER
The council’s formal buy back offer will take into account the fact that a secure tenancy of the property is being offered as part of the process. It will also detail all deductions to be made in respect of outstanding debts such as mortgages, secured loans and service charge arrears. Any remaining balance would be paid to you, through your solicitor, upon completion. We will also include details of the weekly rent you could expect to be paying and the rights and obligations you would have as a secure council tenant.
 

YOUR ACCEPTANCE
Should you wish to proceed with the council’s buy back offer then your written acceptance is required. A surrender document, which is needed in order to for you to give up your lease, will then be drafted and sent to you by the council’s solicitors for you to sign and return. If you haven’t already done so, you must appoint a solicitor at this stage and provide us with contact details.

The council’s offer is non-negotiable. However if you feel that there are exceptional circumstances attached to your case then you would need to write to us with detailed reasons as to why the council should reconsider its offer.
 

THE COUNCIL’S PAYMENT
The council’s payment (offer price less outstanding debts and administration costs) will at this stage be forwarded to your solicitors and retained by them until completion.
 

SURRENDER OF LEASE AND BEGINNING OF COUNCIL TENANCY
On the agreed date you will sign for the surrender of your lease and the council tenancy agreement. From this date you will be granted a secure council tenancy of the property and be liable for rent and all other relevant charges as applicable.
 

PROPERTY DEBTS PAID
Finally, your solicitor will be responsible for paying off your remaining property debts such as your mortgage and any secured loans. Although there is no guarantee that the valuation will exceed the property debts, any excess remaining after deductions (service charges, ground rent and mortgages) will be paid to you by your solicitor.
 

FREQUENTLY ASKED QUESTIONS
How much will I receive for my property?
The valuation will reflect the fact that a secure tenancy is being offered as part of the buy back process and you will therefore remain living at your property. Valuations in these circumstances are typically in the region of 25% of the open market value although the condition of your property (internally as well as externally) will also be built into the valuation. You should also be aware that any property debts (mortgages, secured loans, service charge arrears, etc) must be settled from the buy back premium.

At what stage will I need to appoint a solicitor?
You must appoint a solicitor once you have decided to accept the Council’s official offer to buy back your property. If you can show that you are unable to afford a solicitor the council may be prepared to cover the solicitor’s costs up to a maximum of £500.

Can I withdraw at any stage?
You can withdraw from the buy back process and remain a leaseholder at any stage up to the date of the lease surrender. However the council will then be obliged to pursue any service charge debt you might have.

How much will it cost me?
You will not be billed for any costs whether you complete the sale or withdraw at any stage.

How long will the process take?
We estimate that the process will take a minimum of three months.

Can I repurchase my property at a later date under the Right to Buy?
There is nothing to stop you applying to repurchase your property through the RTB scheme in the future. However the cost of the council buying back your property and any previous RTB discount will be taken into account when the new RTB offer is made. This will in effect mean little or no discount being given.

What next?
If you wish to be considered for the buy back scheme and have not already done so then please contact Steve Burr (steve.burr@camden.gov.uk) on 020 7974 8501 or alternatively write to him at the following address with details of your circumstances and why you think the scheme would be suitable for you: Leaseholder Services, Bidborough House, 38-50 Bidborough Street, London WC1H 9DB.

Setting up a Leaseholders’ Association

We explain the potential benefits of forming a Leaseholders’ Association and walk you through the steps of setting one up. Leaseholders’ Associations are different from TRAs and have extra powers – so they can be useful in addition to a TRA.

This guide is also available as a PDF download.

Index
What is a Leaseholders’ Association?
What are the benefits?
Is a Leaseholders’ Association already active in your area?
How to become a formally recognised Leaseholders’ Association

What is a Leaseholders’ Association?
A Leaseholders’ Association is the term used in Camden for what is, in law, referred to as a “Recognised Tenants’ Association” (RTA). “Leaseholders’ Association” is used primarily to avoid confusion with organisations that are of and for secure tenants. A Leaseholders’ Association is set up where a group of leaseholders have come together to better represent their common interests to their shared landlord. For the purposes of this document, the shared landlord is Camden Council and any single Leaseholders Association is usually confined to one housing estate, block, building, but can cover a group of street properties which Camden has put together for a capital works scheme.

In general, Camden Leaseholders’ Forum advises leaseholders to work with their tenant neighbours and use the extra powers of a Leaseholders Association for the benefit of all concerned residents.

n.b. The Leasehold Advisory Service (LEASE) has a fuller, more technical, definition on their website.
What are the benefits?
Unlike TRAs or individuals, Leaseholders’ Associations have powers, usually set out in guidance, as follows:

1. To request a summary of their members’ service charges incurred by the landlord
2. To inspect the relevant accounts and receipts related to those service charges
3. To view insurance cover and inspect the policy
4. To view estimates obtained by the landlord for long-term agreements or intended works
5. To nominate contractors to be invited to tender when the landlord wishes to enter a long-term agreement or carry out qualifying works (unless the works need a notice in the OJEU, as many of Camden Council’s do)

There are additional powers which can be extremely useful and which are statutory, though the cost of exercising them falls on members of the Association:

6. To appoint a qualified surveyor who then has a right to access documents and premises so as to advise the RTA on service charges, including relevant documents belonging to a contractor.
7. To appoint a qualified accountant or surveyor to audit the service charge accounts.

These two powers can be used to force the landlord to produce evidence which could then be used to challenge service charges in the First-tier Tribunal (Property Chamber – Residential Property). The right to request information is absolute; commercial confidentiality cannot be used for refusing to release it.

In practice, Camden Council also tends to speak directly with the Leaseholders’ Associations when running consultation exercises, which makes discussions about potential changes and works easier and can help streamline these processes. A Leaseholders’ Association also makes Camden Council consider requests with more weight as the request is coming on behalf of a larger group than any one individual.
Is a Leaseholders’ Association already active in your area?
Check that there is a Leaseholders’ Association already running via this page.
How to become a formally recognised Leaseholders’ Association
2. Leaseholders’ Associations must normally represent at least 60% of the leasehold properties in the block or area and provide this list to Camden Council. You can find your fellow leaseholders by reading this guide which we have published.
3. Leaseholders’ Associations must adopt a constitution (Camden Council’s Leaseholder Services department can provide a template for this).
4. The next step after this is to contact Camden Leaseholders’ Services department and request formal recognition.
5. The last step is to hold an Annual General Meeting where the Executive Committee needs to be elected. This first meeting must be witnessed by an officer from Camden Council.

Camden require that Leaseholders’ Associations re-apply for recognition every two years and that they are updated as to any changes in membership.

Camden Council have a section dedicated to Leaseholders’ Associations on their website (although the page does refer to them as RTAs).

If Camden refuses recognition, or there are grounds for suggesting that their criteria are too harsh, there is a right to appeal and seek recognition through the Leasehold Valuation Tribunal.

Finding Fellow Leaseholders

There are a number of situations where you may mind it beneficial to find out who your fellow leaseholders regardless of who owns your freehold.  Our guide explores some of the free resources that are available online and can help you.

This guide is also available as a PDF download (with accompanying images, which may be of help).
 

Why would you want to find your fellow leaseholders?
There are a number of situations where you may find it beneficial to find out who your fellow leaseholders regardless of who owns your freehold.
– Discussing issues with fellow leaseholders in your block/estate
– Forming a Leaseholders Association to improve day to day communications within your block/estate and Camden Council
– Lobbying in regards to Major Works and Regeneration issues
 

Information Available Online
All of this information is available for free online if you know where to look. The cautionary notes are:
– a property may be owned by leaseholder but this can still include housing associations, corporate entities as well as individuals.
– this document presumes that the properties you are investigating are definitely Camden Council freehold properties (but you are checking whether the property is a tenancy or leasehold). If you are unsure as to whether the property is owned by Camden Council, then this information is available online but there will be a small additional charge.

Tip! There may already be a Leaseholders’ Association running in your area. Check our guide for further information.
 

Step 1 of 4: Addresses
The first step is that you have to know what addresses you are looking for. A walk through your neighbourhood may assist.
 

Step 2 of 4: Postcode
You will need the postcode for the Land Registry website, so first you will need to look it up.

Click on the following link: http://www.royalmail.com/find-a-postcode

Then type in the house/flat number in the box entitled “Type part of an address to postcode to begin” (you can ignore the example text in the box as it will disappear as soon as you start typing). We have circled the area where you start typing in green in the screenshot below. When the right choice is shown on the screen just click on it. As an example, you can start by search for your own postcode.

TIP 1: For Camden Council properties, the town will always be “London” (i.e. not Kentish Town/similar).

TIP 2: The building number is not required. Skipping “building number” can sometimes display the results of multiple properties and save significant time (and also help running into the website limit of 50 searches a day). For larger blocks, you may wish to put in the building name, street and town but still leave the building number entry.

You will then be presented with the appropriate postcode which you can then write down or past into Notepad/Excel/Word etc, for future reference.
 

Step 3 of 3: The Land Registry
The Land Registry is the repository of all the ownership details of properties throughout England.
You will need to go to: http://eservices.landregistry.gov.uk/wps/portal/Property_Search and then fill in the house number/name and postcode boxes as appropriate. Then just click “search”. Again, if you want an example to kick start your search, look up your own property.
 

Step 4: Interpreting the results
If the Land Registry website offers to you that you can buy directly title register/title plan straight away then this means that the property is owned by the COUNCIL as there is only a freehold (and the council own that). To double check that the council do indeed own the freehold you can click on “Title register” although you will there is a cost for that.

If the Land Registry website displays multiple boxes saying “information available” this means it is LEASEHOLD (individual, housing association or corporate). It will also say “leasehold” somewhere on that same screen, just as a way of visual confirmation.

TIP: If you click on the “Information available” button alongside “Tenure: Leasehold”, then you can purchase the “Title register” which tells you who the current owner of the property is for £3 (or knock on the door and ask; this can be useful if the property is sublet).
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

If you know of anyone who would like to receive updates from Camden Leaseholders’ Forum please direct them to https://www.leaseholdersforum.org.uk/mailing-list where they can sign up. Subscribers can also adjust preferences by clicking on the link at the bottom of any email we send.

Gas Pricing

We get a number of queries regarding gas pricing and requests as to whether we can give advice to people having to pay for Camden Council gas when they would prefer to buy gas off the general market. There is little information easily accessible about this, so we’ve decided to delve into a little bit of history to provide some background about the causes of the current situation.

The long and short of the current situation appears to be, though, “well, I wouldn’t start from here if I were you(!)”. Read on to find out how we got here in the first place and what the options are.

This guide is also available as a PDF download.
 

Index
The Basics
History
Today
Maintaining Camden’s Network
Per Unit Comparisons
Individual Conversions (e.g. for single properties)
Conclusion
Appendix: Written Answers from Camden Council
Written question asked by Camden Leaseholders’ Forum in June 2014
Answer from Mike Edmunds, Head of Leaseholders Services at Camden Council
Answer from Pat O’Neill, Head of Service Delivery at Camden Council
Appendix: More information about Camden Leaseholders’ Forum
 

The Basics
Energy prices to the consumer comprise three elements:
• Fuel costs (represented by the price of gas);
• Transmission costs (the gas network to Camden’s meter, and then potentially from there to your meter which may be Camden’s or belong to the Transco (see below));
• Government on-costs to cover taxes; green schemes for gas users; and schemes for those in fuel poverty.

In the words of the London Energy Project (more of which later on):
Energy is a supply category that presents complex strategic and highly technical operational management challenges:
• Approximately 50% of supplied electricity and 75% of supplied gas costs are regulated by government
• There is very little choice between large/powerful suppliers, delivering varying levels of service
• Administration costs are high, with close to 100,000 electricity and gas meters to manage across London
• Mandatory carbon regulations are burdensome and expensive

So, quite large swings in the cost of gas will have far only a small impact on the overall cost to you (as a consumer) as the above costs are a high proportion of the overall total.
  

History
British Gas can mark its history as beginning in 1812 when The Gas Light & Coke Company (GLCC) was set up after royal approval by George III while Britain was still at war with Napoleon. Fast forward to 1948 when Clement Atlee’s Gas Act, started to nationalise the industry and created 12 regional gas boards, ending the GLCC and setting the precursor to British Gas.

Camden was created in 1965, and came under Labour control in 1971. It then began a major expansion of its council housing, constructing new estates and installing utility supplies to them. network.
 

Today
In 1994 British Gas was restructured into two different parts: “Transco” (now National Grid), transporting and storing gas and “British Gas”, selling gas. Since then other companies have been encouraged to enter the market and resell gas (using the National Grid network) in competition with British Gas.

Under current legislation, there is a division of who owns the distribution network; who may repair it (basically very carefully controlled and licensed contractors); and who pays for the repairs (ultimately, gas consumers or some sub-group amongst them).

Camden Council was given an offer it felt unable to refuse. In return for lower gas prices before 1994, it agreed to take over responsibility for the gas network from British Gas. That deal survived the 1994 changes, so Camden still has its own gas network serving many (but not all) of its own properties. Currently there are 393 separate gas installation pipelines owned and operated by Camden Council (including 6 which have been capped and are no longer in use). In total there are 131 residential gas networks and more networks to non-residential properties. This all adds up to 55km meters of pipework in total. We are not aware of any other local authority in such a position, and as explained in the Appendix, there is little realistic possibility Camden will be able to dispense with the deal it made. But, the fact that Camden “owns” network does not mean it is free to do what it pleases with repairing it or replacing it.

Camden’s residential networks supply heat, hot water or cooking gas or combinations of these, sometimes alongside the National Grid network. There are many variations in delivery (more details of which can be read in Camden Leaseholder Service’s) Service Charge Guide)).

Non Camden Council owned properties are typically (but not exclusively) fed by the National Grid network to the domestic meter.
 

Maintaining Camden’s Network/Passing Control to National Grid
Why does Camden Council still maintain their own gas network? In their own words:
“We have been looking into the potential to divest the Camden Network to a private provider for some time now but it is proving extremely difficult to do it”.

“Organisations such as National Grid and the other main distributors would require a complete upgrade of the network to current standards before accepting it. This would have a significant capital cost – I have no doubt that our leaseholders would not be pleased at having to meet it.” (Pat O’Neill, Head of Service Delivery at Camden Council in a written answer to Camden Leaseholders’ Forum back in 2014).
 

Per Unit Comparisons
OK, so Camden supply the gas. Why can’t we compare the price of a standard British Gas unit, against the price of a Camden Council gas unit, to see how cost effective (relatively cheap or expensive) Camden are?

At one stage, the government got interested in fuels savings, and encouraged local authorities to band together to buy in bulk, and demonstrate savings. The local results included the London Energy Project (LEP) founded in 2006 and the LASER energy buying group founded in 1989. But, savings? The LEP is quoted earlier in the document; at the time of writing, and a decade after being founded, it is nowhere close to being able to compare costs, and it says it not sure if it is worthwhile trying.

And the situation in Camden in particular? “Benchmarking is almost impossible on heating charges as you are often not comparing like for like, each heating system is different. Large local authorities will have old systems which are not energy efficient, there may be nothing wrong with the systems but compared to more modern boilers they are expensive. As well as the boilers pipe work could be old so there are more repairs and heat loss.” (Mike Edmunds, Head of Leaseholder Services in a written answer to Camden Leaseholders’ Forum back in 2014, with our emphasis).

As an aside, we would argue that benchmarking of some elements is possible in areas such as regulation of pipelines fees and how Camden control their maintenance costs. Interestingly it’s an argument often used by incumbent monopolies, that benchmarking isn’t possible; in sectors with competition the argument is used less often!

There’s another variable going on too. Camden Council buys their gas in advance on a long-term contract. Like buying gas via a comparison website, sometimes this means that the market is timed right and they lock in a cheap price, but unfortunately there is no guarantee that they might time the market incorrectly and buy at a more expensive rate. In the long run a statistician would say that this particular issue (of timing the market) balances out. Camden adds that they do bulk buy so hopefully getting a cheaper rate – whether this balances out the various issues mentioned above, is a different matter.
 

Individual Conversions (e.g. for single properties)
It’s worth answering this particular point: Camden Council do not do individual conversions. Simply put: it’s too expensive and may have knock-on effects elsewhere. The example they give if is one person on an estate has National Grid for cooking gas, but Camden Council gas for heating. If the leaseholder swaps over, and then has heating via a combi-boiler, this puts a lot more pressure on the system than cooking gas. i.e. Converting one property over might be ok, but the existing infrastructure wouldn’t support an entire estate. Why should one property swap when the others then won’t be able to?

Camden Council are prepared to consider entire estates swapping, but this needs the involvement of the TRAs and the agreement of tenants and leaseholders as well as the financial figures being justifiable to Camden Council. Some estates have enquired about this and, as far as we are aware, these discussions are still on-going at least 4 years later! (correct as of August 2016)
 

Conclusion
In essence the existing National Grid/British Gas system is priced based on a modern efficient network, whereas the costing for the Camden Council network doesn’t match those standards so has a different cost base (could be more, could be less!).

If Camden wanted to bring their network up to National Grid standards, the one-off cost of doing this might outweigh any potential advantages of being on the national network. That said, if you are getting other associated infrastructure upgraded (e.g. a heating system replacement/upgrade to your block/estate), then further investigation can be worthwhile as it might become easier/cost efficient to transfer the local supply to the National Grid at that stage. 
 

Appendix: Written Answers from Camden Council
Written question asked by Camden Leaseholders’ Forum:
From the June 2014 meeting: What comparisons/benchmarking exercises have taken place to compare the existing heating systems to other similar systems around London/the country, in terms to cost at point of residents’ use. Are there any further exercises (comparisons/benchmarking) scheduled to take place?
 

Answer from Pat O’Neill, Head of Service Delivery at Camden Council
I think there are some other public sector housing providers who manage their own networks but they are very few in number.

We have been looking into the potential to divest the Camden Network to a private provider for some time now but it is proving extremely difficult to do it.

Organisations such as National Grid and the other main distributors would require a complete upgrade of the network to current standards before accepting it. This would have a significant capital cost – I have no doubt that our leaseholders would not be pleased at having to meet it.

Record information identifies that there are 393 separate gas installation pipelines owned and operated by LBC. This equates to approximately 55 kilometres of gas installation pipeline. Six of the gas installations are no longer in use and have been capped.

131 residential gas networks are registered in Camden’s Gas Safety Case although a greater number are recorded on LBC’s licence to convey gas.

Each separate gas installation is interconnected into a public gas distribution network via a gas ‘service pipe’. This service pipe (not owned by LBC) is terminated in an emergency control valve (ECV) immediately up-steam from the installation gas meter assembly.

The gas meter assemblies are owned and operated by a Gas Shipper.

The cost of upgrade would be substantial – not to mention the disruption to road infrastructure and the upheaval caused by decommissioning and recommissioning individual installations.

On top of the pipework we have 194 boiler houses serving 13,400 residents on district heating systems so managing a change of gas network would be significant risk.

Residents on bulk supply seem to forget the fact that they are not subject to normal market forces in respect of the price of gas – we get economies of scale in buying in bulk and these are transferred directly to residents. Any organisation that would be likely to have an interest in taking the networks off our hands would want to recover the costs – probably through an annual charge and they would certainly not provide the gas at cost.

Just a short note on combination boilers: There is an as yet unquantified risk with combis in relation to their demand for gas at fire up and the potential for upstream gas starvation. In short they have a short term higher immediate demand for gas at fire up than a conventional boiler. Sufficient combis linked to the same supply pipe could therefore potentially cause gas starvation upstream. We’d have to do a lot of work in calculation of the risk and whether or not the existing network has capacity before wholesale installation of combis.
 

Answer from Mike Edmunds, Head of Leaseholders Services at Camden Council
Benchmarking is almost impossible on heating charges as you are often not comparing like for like, each heating system is different. Large local authorities will have old systems which are not energy efficient, there may be nothing wrong with the systems but compared to more modern boilers they are expensive. As well as the boilers pipe work could be old so there are more repairs and heat loss. We are a member of a bench marking group and are likely to do some more work with the group when 2013/14 costs are completed in October on average costs for different size units.
 

Appendix: More information about Camden Leaseholders’ Forum
We are a volunteer group representing all the leaseholders in Camden Council properties and freeholders paying service charges to Camden Council. We scrutinise Camden Council proposals, examine working practices and lobby on behalf of leaseholders to Camden Council.

More information is available at https://www.leaseholdersforum.org.uk

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