Chobham Manor residents call for scrapping of 'unfair' estate charge
- Credit: Ken Mears
Residents at a housing estate on the edge of the Queen Elizabeth Olympic Park are calling for an "unfair" charge to be scrapped.
The Chobham Manor Residents Association (CMRA) has a number of concerns about a fixed estate charge (FEC) paid to the London Legacy Development Corporation (LLDC), which manages the park.
In April 2016, then-mayor of London Boris Johnson delegated power to the LLDC to collect the FEC to raise money towards the upkeep of the Olympic Park.
The residents' association has written a letter to the LLDC asking for the charge to be abolished for Chobham Manor homeowners.
It claims that the starting rate of the FEC on a three-bed property at Chobham Manor is more than £1,350 per year.
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The residents wrote: "The FEC is clearly an unjust and unfair extra cost imposed on the Chobham Manor owners."
But an LLDC spokesperson described the charge as a "reasonable" one.
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“We believe that the Fixed Estate Charge is fair and makes an important contribution towards the cost of maintaining the parkland and its venues."
The government announced leasehold reforms in January to change the current law, which it said sees many people pay high ground rents on properties they own.
The CMRA claims that the FEC is "effectively a ground rent obligation" and does not provide any benefit to property owners.
It says those who pay it receive no discount schemes or exclusive access to the Olympic Park, adding they still have to pay separately for the maintenance of roads and play areas inside the development.
They also claim in the letter that the charge is "likely" to make it difficult to sell or mortgage properties.
"The consequences of the FEC have the potential to be extremely damaging to Chobham Manor owners, in the same manner that ground rent obligations can and have been to many leaseholders," the letter says.
The LLDC spokesperson said the FEC is not a ground rent and charges of its type have existed for many years.
She added: “The park FEC applies to all types of occupier on the park estate from residents to businesses.
"The government has acknowledged the legal basis for estate charges and their use over many years in its recent consultations on proposed changes to leasehold.
“The requirement to pay the FEC, in addition to council tax and service charges, is made very clear to prospective residents and businesses from the outset to ensure they understand the charge and their liabilities. The boundaries for the FEC are clearly identified."
The association believes owners should not have to pay both the FEC and council tax, and feels the cost of upkeep for the park should be shared by Newham, Waltham Forest, Hackney and Tower Hamlets residents.
The group wrote: "We strongly believe that its maintenance should be funded through the residents of these four councils in equal measure rather than an additional burden falling disproportionately on Chobham Manor owners and future neighbourhoods built on the Olympic Park."
On the park's website, it says the FEC "contributes towards the management of the parklands, footpaths, cycle ways, bridges and waterways that make up Queen Elizabeth Olympic Park."
But the CMRA says there is no detailed breakdown of the costs, adding: "It is unfair and unjust to require Chobham Manor owners to blindly contribute towards costs that could be completely unreasonable."
They are calling for the LLDC to use a deed of variation to remove the FEC obligation for homeowners.
The LLDC spokesperson added: “The FEC is currently increased by retail price index (RPI) and not by LLDC’s actual costs, which are greater.
“The park is maintained to very high standards and is home to world-class facilities benefitting residents in both the quality of their environment and the long-term investment in their property.
“We welcome the government’s consideration to give freeholders who pay an estate charge the same rights as leaseholders to challenge such charges at a tribunal and we are confident that our charge would be found to be fair and reasonable.”
The Chobham Manor development will have almost 900 homes when it is completed and sits within the north-eastern boundary of the park.
It is being built by Chobham Manor LLP, a joint venture between housebuilder Taylor Wimpey and developer L and Q.