Q&A from reader
Please add views as comments
When Haringey switched to an arms-length management organisation (Homes for Haringey) I figured it might improve the management of my two rented leasehold properties. But sadly all it meant was a £300+pa management fee slapped on top.
In recent months their high service charges etc have irritated me more and more (two windows and a roof contribution recently cost £10k, another is likely to be £40k next year). Challenging those I expect would be hard, but I’ve been inspired by your coverage re sublet fees to look at this.
Haringey ask me to pay either an annual sublet license fee, or a fee each time the tenant changes (scheme summary from their web site is below). Sadly the leases on both properties do appear to require payment of sublet fees, described on my two property leases as “not less than £20.00 for each registration” and “£50.00 for each such registration or such larger sum as the Corporation may reasonably require”. I’ve paid everything they asked for. The clauses are in full below.
If I were to take this to the first tier tribunal, can I expect the process to be fairly straightforward as I’m simply asking them to judge what the sublet fee should be? I’ve no sense of what my time and money commitment would be, but I do think it’s important these councils are stopped from bullying leaseholders. When asked to justify these fees they just tell me “that is the fee, you have to pay it”! £75 is a lot of money to scan a copy of an AST and put tenant details in a database, it looks like blatant profiteering, though not as bad as some freeholders.
Homes for Haringey Subletting charges
Following consultation with the Leasehold Panel, Haringey Council has approved the following charges to be levied for leaseholders who sublet their properties.
Leaseholders who sublet their properties have two options for paying their charges which are described below. You must choose one of these options and state your choice on the registration form.
1. Annual charge of £20
This is included in the Annual Estimate. This will be the best option if your tenants change fairly often. If you notify the Home Ownership Team after the estimate has been raised, we will include the charge in your Actual Service Charge which will be issued in the following year. Therefore you will not be required to make a separate payment.
2. Registration fee of £75
This charge will be appropriate for you if your tenants only change occasionally. You must complete a new form and pay the charge of £75. Reason for charges The landlord has legal responsibility for the building and has obligations to all residents who live there. If there is a problem inside a leasehold property the leaseholder should take the necessary action. However if he or she fails to do so, Homes for Haringey acting on behalf of the Council as the landlord must take the necessary action.
Leasehold Knowledge Partnership replies:
To be frank, these subletting fees are not onerous.
I am not sure about challenging LAs on subletting. It has not come up, but if these figures are typical, I am not surprised.
Dealng with a woman in Camden today who faced £250. Now the freeholder has been challenged I am told it is all a misunderstanding.
You are in a weak position as a leaseholder in a council owned block. The council’s primary task is to house the homeless, and they set the bills. Leaseholders have to pay their share,and can get hit with huge bills.
Argue over these – early, clearly, informedly – rather than winge about subletting fees that are not excessive.
With respect, Leasehold Knowledge Partnership seems to have missed the point. Wingeing doesn’t come into it nor does LKP’s own understanding of what is or is not ‘onerous’ hen calculating fees. In fact . LKP is falling into the same trap as many managing agents, of taking upon itself to define what is acceptable and what is not on the basis of what is believes is fair or reasonable or normal. Tut tut!
Subletting fees are either allowed or not allowed by the lease – a contract between landlord and tenant which determines pretty much everything to do with the management of all leasehold property.
LKP Admin, please note.