AIBU to be absolutely devastated by this?

Okay this is my take OP.

If you’re getting 40 K of your deposit back then the mortgage will be paid back. It could be worse - it’s not like you will still have money owing when you sell.

I would get out. You can make back money and you can live with a bit less money but you can’t get back more time. Life isn’t a dress rehearsal and you’ve said yourself you’ve delayed your family plans.

There is also the cost to your mental health & life worrying about this and your marriage talking about it. At the moment you’re in limbo, a special kind of hell where you’re deciding what to do & wondering what will happen & where you’ll go from here. If you cut your losses, you’re free to move forward, and put it behind you.

Life is sometimes about making lemonade from lemons. You’ll learn from this and rebuild. Hopefully you can afford a family home in Scotland with some potential, something to make memories in and that you won’t sell for a while - so it won’t matter if its value goes up or down. You’ll steer clear of anything like this again and have better luck.

It’s fair to feel devastated but if you let it consume you then you’ll be stuck. Move forward, look for ways you can salvage this decision. Either fight it or cut your losses and start a beautiful family in Scotland.

Are you drunk?!?!

So how much money would you get actually get from that sale amount? What is not mortgage, what is your own money?

This falls into a massive POLITICAL (if the political is about people) problem, predatory housing, where housing falls under investment and profit, rather than a right to shelter. It creates a valuable market of permanent renters. Unregulated, high cost of rent, or (pretend) ownership, means exclusion for most. This is part of the financial strangulation of the lower and middle classes, and especially the young. The knock on effects are substantial.

This is part of the reason Trump won so big in the States, why there were protests in Spain this summer, and many more examples over the Western world. It is a big problem, because the huge Hedge funds that operate in this sector can penetrate any market, ride out the natural flux of markets, let properties sit empty to maintain prices etc. Tax laws and banking help those who are already wealthy; land ownership in cities plays a strong role too.

I would try to fight back. The only power available to you and others, will be in numbers, and exposure.

Get as many people as possible together, and delegate, create roles. Gather all the evidence you can about the company, their finances, their dealings with you/all of you, other buildings they own etc.

I would get all of you to contact your MPS, your local politicians, the council, the people in charge of building reg (why is it your cost?), the company who built the building in the first place, consumer rights, and document each and every effort and response. Film and record what you can, but do that bit legally.

Then, I would hammer the doors of Chanel 4 news, BBC, the Times, the Guardian, all of them. It is an excellent story for news people as it impacts most of the population, has clear victims (us) and clear bad guys (developers and all the rest).

The numbers you are quoting should clearly be illegal, I am pretty sure there is not one household that can absorb that kind of cost.

I can really feel your distress. Especially as you want to start a family, did the right thing by saving for a home, being a responsible person and citizen. To then find all of your efforts swallowed by predatory fuck wits must be very hard to take.

Good luck @Haveyouseenthischicken

I think a WhatsApp group of flat owners and then right to manage. It is do-able and the property company does not deserve this cash

I’m so sorry you’re going through this! I owned a flat managed by HML too. I really hope some of the suggestions from PPs help. I’ve seen other horror stories of leaseholder charge increases in England and it’s absolutely crazy it’s not more regulated. Best of luck!

Sorry, this is a bad situation.

I do think the auction and more pertinently the reserve would just lead to more disappointment.

If you had the opportunity to buy a flat for £230k that had a £9k service charge would you buy it? Of course you wouldn't, so you are looking for someone with more money than sense. The market doesn't work according to how much you want or need, and there are loads of other properties that don't have high charges.

You could say someone might do it for the capital gain angle, but a block like this would contain lots of people in a situation to yourself, so that is pent-up supply of frustrated sellers.

I saw a similar flat in Croydon on auction, I guess pre-pandemic this might have been around £275k, but cladding (and dodgy shenanigans) put the service charge up to stupidly high levels. After lots of sellers trying to get out at £250k and failing, it seemed there was one forced seller, and that flat went for £120k. If you consider the service charge fee, that price is actually quite fair.

The positive about the flats is that it is easy to rent, and you are recouping your costs back at least. So riding it out until the costs reduce, or getting RTM are the best ways forward.

@Haveyouseenthischicken , @usertaken has sage advice.

I think you need to play a long game now, get as many people as possible together across the country who have lease hold property that is owned/managed by this group.

In the meantime resign yourself to a long game with this flat. If you manage that at all it may be the only way to get a return.

I don't know if it's been said, as I've not RTFT, but @Haveyouseenthischicken have you spoken to the Solicitors Regulatory Authority? This massive increase will likely be in the lease, and your solicitor at the time of your purchase should have noticed it and pointed it out. If they didn't, you could be able to claw some of that loss back from the solicitors?

You're right in that it's essentially making it un-mortgagable, which then means you're limited to cash buyers, IF they are willing to take on the increasing service charges. There was a huge thing in the industry a few years back where developers were writing these sneaky increases into leases. But by 2020 all major lenders will have been aware of it, and so a good property solicitor will have known about it and should have raised it during the purchase.

YANBU at all. You did everything right and got screwed by greedy businesses at every turn. Then people wonder why no one’s having kids anymore!

I have a relative who bought a new build flat in a swanky city centre development perhaps six years ago. The service charge has gone up to £5k already and they’re thinking of selling. Because if that’s what it is now, what’s it gonna be a few years down the line? Luckily they seem to get a lot done for their money. But I imagine there are so many in your boat, paying through the nose and getting nothing for it.

Hi there OP this is disgusting and a scandal, If I were you I would contact Carol Lewis on the Sunday times, she is the property editor, and is really good on stuff like this. A few phone calls from a journalist and the promise of some terrible publicity in a national paper might have more impact than even a lawyer’s letter (and is free). Also make sure you contact your MP en masse, and get them working on this for you - this is what MPs are for - the government did pledge to end the leasehold scandal in their first 100 days which they had to row back on but they should be minded to crack down on these sorts of practices which should be criminal! Good luck

This sounds an absolute nightmare and I'm so sorry that you've been put in this position. I'm sure that there are management companies all over the country passing off the cost of making the changes to blocks required after the Grenfell disaster to residents. I know George Clarke (gorgeous George off Small Spaces on tv!) feels very passionately about this so it might be a good idea to get in touch with him. He's got a very active Instagram account so maybe try through that. This isn't something you should be expected to deal with on your own and needs to be escalated to people with some clout. Definitely contact your local MP and try getting a petition up with the other residents. I can only wish you good luck 🍀

I would suggest you get your local MP involved.
Also get a detailed rationale behind the increases. Management firms can not increase fees without suitable support. Ask for proof that expenditures have been made and ask whether any of the vendors are related companies.
We ran into a similar situation with our Management Company and involved our MP, at which point they got extremely defensive.

Agree with this statement from @Monty27
I would be asking Martin Lewis for help

This l believe that you are entitled to manage it yourself and certainly ask the management company to justify their ridiculous charges, so sorry for you.

Write to them and copy in the fucking Prime Minister!!!

If anyone thinks I’m joking, I’m not.

Don’t despair. Rogue landlords like this one can be beaten. All it requires is for a majority of the leaseholders to insist on their right to manage. Speak to the Leasehold Advice Cemtre. They’ve just helped me and a number of other leaseholders replace our dodgy landlord increasing the value of our properties and slashing maintenance and service costs.

Apologies if this has been mentioned, @Haveyouseenthischicken could you try talking with the Housing ombudsman who are meant to support people in your situation

Not read full thread.

echo suggestion of Right To Manage - see “user1471548941 · Yesterday 01:39“

alternatively check out the leaseholder’s Advisory Service which has lots of useful information around service charges/estate management charges law and will guide you through any conflicts.

I was going to ask if it was HML. They’re the grifters I have to deal with too. Really sorry, OP, I hope you get a resolution.

I can only sympathise. We went through a very similar thing with our flat in London. The service charge doubled year on year for the four years we had it, ending up at £10k for a year. It was brutal.
In the end we sold for a price that was massively under market value (think around £100k) and with a clause that we would pay an additional amount to the purchaser for up to one year after the sale should it go above £10k again. To be honest, the relief of having the bloody thing gone was worth it by that stage.
No advice other than never by another leasehold property. You’re in the hands of someone else the whole time and it’s an awful feeling. Speak to your estate agent and see if a similar clause being written in to offset the charge for the future owner might drum up some interest. Good luck!

Not read the full thread. Has anyone mentioned contacting your local MP regarding the outrageous service charges?