Tuesday, 23 May 2017

Councils will be able to ‘get around’ £10k cap on leaseholder charges

Confusion over repairs caps

A proposed cap on what councils can charge private leaseholders for repair work has been met with confusion and scepticism by legal experts.

Communities secretary Eric Pickles said on Monday he wanted local authorities which receive government funding to help maintain tenants’ homes to charge leaseholders a maximum of £10,000 over five years for repairs, or £15,000 in London.

Lawyers were divided on whether the proposals would be costly for council landlords.

Giles Peaker, a partner at Anthony Gold Solicitors, said councils could still use money not provided by the government to pay for communal repair works, which would mean they could charge over the cap.

‘[The proposal] is fairly meaningless,’ he said ‘It only applies where there is government funding related to the works… I think this would be really easy to get around.’

Councils using decent homes grant would have to restrict leaseholder charges under the proposals. The government announced a further £160 million of decent homes funding in June’s spending review for 2015/16. It has spent £1.56 billion on the programme since 2010.

The proposal includes the use of future decent homes cash and any future government funding used for works of repair, maintenance or improvement. It will not affect repairs and maintenance work funded by housing revenue accounts.

Mr Peaker said councils could get around the new rules, which are subject to consultation, by fixing a leaking roof at a different time to conducting repair works done with decent homes funding.

Catherine Hand, a partner at Trowers & Hamlins, said councils were already conducting a lot of repair works not funded by the government so the impact would be limited.

However, Gavin Smart, director of policy and practice at the Chartered Institute of Housing, warned local authorities could be deterred from carrying out repairs.

Readers' comments (3)

Comments are only open to subscribers of Inside Housing

Already a subscriber?

If you’re already a subscriber to Inside Housing, your subscription may not be linked to your online account. You can link your subscription from within the My Account section of the website and clicking on Link My Account.

Not yet a subscriber?

If you don't yet subscribe to Inside Housing, please visit our subscription page to view our various subscription packages.

Have your say

You must sign in to make a comment

sign in register


Newsletter Sign-up



  • Corbyn pledges to lift council borrowing caps

    28 September 2016

    Jeremy Corbyn has pledged to remove council borrowing caps to support the party’s ambition to build 500,000 council houses in its first term in power.

  • Sovereign moves repairs in-house

    27 September 2016

    Sovereign is bringing its Hampshire repairs service in-house in a bid to save £2m over five years.

  • HCA to probe associations' repairs cuts

    21 September 2016

    The Homes and Communities Agency (HCA) will examine English housing associations’ business plans to check that significant cuts to repairs spending are not a sign of a “failure to maintain stock”.

  • NIHE repairs contracts announced

    8 July 2016

    The Northern Irish Housing Executive (NIHE) has named four contractors to carry out up to £1bn of repairs across its 87,000 homes over the next 10 years.

  • Relief for housing associations over loan confusion

    3 June 2016

    A disagreement over accountancy rules that could have added billions of pounds of debt to associations’ accounts, has been averted following a ruling by the financial watchdog.

IH Subscription