A huge rise in service fees for leasehold and shared ownership properties – sometimes of tens of thousands of pounds – has led to a record rise in tenants choosing to withhold payment and go on ‘rent strike’, Byline Times can reveal.

The Social Housing Action Campaign told this newspaper that, in the first quarter of 2024, it had seen a fourfold increase in tenants – around 700 people – choosing to download a template letter that can be used to notify landlords of their intention to strike.

A report the group conducted late last year also found that a huge rise in the number of people choosing to withhold rent or service fees for the first time – over 90% of those it polled.

While some of those recorded by SHAC were unable or refusing to pay rent – rises in even social rents has outstripped wages for several years, leaving a growing number of tenants unable to pay.

But the vast majority were those withholding service fees. Usually amounting to a few thousand pounds a year at most to cover communal cleaning and upkeep costs, service fees for leasehold and shared ownership flats have skyrocketed in recent years. 

The Last Resort

While freeholders and managing agents are supposed to be transparent about the things that money will be spent on, growing numbers of tenants have reported being unable to get copies of invoices or end of year accounts from their building owners.

Many of these buildings are run or owned by housing associations – after the government pushed them to move into building private housing stock – to help fund the cost of the formerly council-run social housing they manage across the country.

José Mellado’s South London shared ownership flat was supposed to be an affordable way onto the housing ladder. But just a year after moving in his service charges have started rising rapidly. 

Now he has to pay £469 a month to cover ‘communal costs’ – in a building which doesn’t have the amenities like security or communal areas that normally lead to such costs.

“We’ve only been there for one year so we were shocked, and angry as well. We have no control over it,” he explains.

That cost has come on top of rising council taxes and mortgages that mean between the three costs he is now set to be spending just under £20,000 a year on the flat.

The rising fees (which weren’t disclosed when he bought the property) mean the flat is less attractive to sellers, leaving José feeling “trapped” in the building.

“We need to do something about all this. We can’t just sit there being polite,” he added.

“So we started to strike over the rise – we will pay the original amount but not the increase, and try to raise our voices in another way.”

But even then he knows there are some blocks much worse off than his. In one block in King’s Cross, tenants have been asked to pay £16,000 a year each to cover communal costs, almost triple what it was before.

“People are driven to withhold payment as a last resort. No one wants to be in this position,” said Suzanne Muna, secretary of the social housing action campaign.

"Undoubtedly the financial squeeze is having an impact, and households have to account for every penny. This, together with the unjustified and extortionate charges that we are seeing has left people without a choice.”

She went on: “The problem is also structural – access to justice through other means is closed off. Neither the Housing Ombudsman nor the Regulator of Social Housing addresses complaints relating to service charge levels. 

“Taking your landlord to court can mean having to make a payment and landlords consistently threaten tenants and residents that they will seek to recover their own legal costs from you if you lose.”

She adds that the morning we spoke two tenants reached out in need of help after skyrocketing service fees that left them dreading letters from their landlord and feeling like they “can't see any light at the end of the tunnel”.

The National Housing Federation, the trade body for housing associations, declined to comment.