Residents win Curo service charge legal battle

Residents living in a block of flats have won a legal battle against their housing association - after being faced with a service charge increase of more than 300 per cent.

Nine families living in Weston-super-Mare in Somerset had seen their monthly fees go up from about £70 per month to more than £300 a month.

Housing provider Curo has now agreed to limit the charge to just over £100 after being taken to tribunal.

A spokesperson for Curo said that it had "already agreed these reductions before the tribunal took place".

Curo continued: "What we're trying to avoid is large bills that leaseholders aren't expecting.

"Keeping people safe is our priority, and we need to balance ensuring the right fire safety measures are in place with trying to minimize the financial impact, which we know has been difficult."

Alan Rice from Weston Housing Action said the residents are "ecstatic".

"Quite a few people told us that we wouldn't win, but we were persistent and we got the result we wanted", he added.

The dispute related to a property called Coombe Lodge.

It contains nine flats, all of which are shared ownership - a scheme designed to help people get onto the housing ladder by buying a portion of their property, and paying rent to a landlord for the remainder.

When the service charge went up, one resident said they had to take on an extra job, while others said they were anxious they'd be unable to afford the higher fee.

Curo said the extra money was primarily to increase the block's sinking fund, which acts as a long-term savings account for building costs.

Rice said that while there is "some need" for a sinking fund, it was "devastating" for residents.

He said: "Although they were sold to them as affordable homes, suddenly they weren't affordable any more."

The residents will now be reimbursed the excess charges they have paid.

'Working with residents'

In response, Curo said "There are always maintenance costs linked to owning a flat in a block, and we completely understand that these can be a shock when significant work is needed.

"That's why there are sinking funds, which are like a 'savings account' for the whole building, to help flat owners spread the cost across several years."

The provider said it hoped it can "continue to work constructively with residents at Coombe Lodge to resolve all the remaining issues going forward".

There is no limit on how much a service charge can increase, but a law passed in 2024 should eventually force managing agents to provide a full breakdown of costs.

The Leasehold and Freehold Reform Act is yet to be fully implemented. It promises leaseholders clearer service charge bills, and the right to look back at service charge information over the past six years

Samantha Young lives in a Curo-managed block in Twerton in Bath, and said she is going to take her case to the ombudsman after her annual service charge rose from £990 to more than £6,000, which she described as "astronomical."

"It is absolutely not affordable. This is higher than what you'd paid in zone one in London for flats with gyms and concierges.

"It quite frankly feels like we're receiving nothing."

Curo told the BBC it was "having ongoing conversations with Ms Young about how we can work together to resolve this, and we visited her at home this week to agree a way forward".