‘We’re trapped’: developer’s unpaid debt leaves London flat owners unable to sell
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<p>Hackney leaseholders feel council made the problem worse by leaving £850,000 debt uncollected for eight years</p><p>Leaseholders in east London have said they are “trapped in unsellable homes” because of an £850,000 debt owed by the building’s developer to Hackney council, who have let it go unpaid for eight years.</p><p>The 17 leaseholders, who live in a block of flats in Upper Clapton, have appealed to the council for help but their pleas, including requests fo
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‘We’re trapped’: developer’s unpaid debt leaves London flat owners unable to sell Hackney leaseholders feel council made the problem worse by leaving £850,000 debt uncollected for eight years L easeholders in east London have said they are “trapped in unsellable homes” because of an £850,000 debt owed by the building’s developer to Hackney council, who have let it go unpaid for eight years. The 17 leaseholders, who live in a block of flats in Upper Clapton, have appealed to the council for help but their pleas, including requests for a meeting, have been ignored. Rich Bell, 38, is one of the owners. He was expecting to move out of his one-bedroom flat last year, having outgrown it after having his first child. He was in a “pretty advanced stage” of the selling process but was halted when the solicitors encountered an issue. It emerged that the building’s developer, Restoration Hackney , had failed to pay more than £850,000 in Section 106 contributions (payments agreed between developers and local authorities to mitigate the impact of new developments) and community infrastructure levies. This unpaid debt meant that, if Restoration Hackney went bankrupt, leaseholders in the block would be responsible for the bill. Bell said his lawyers were “convinced for a long time that it was just an administrative error” but it soon “became clear that it wasn’t an error and this was the reality”. At that point, the buyer of Bell’s flat was advised by his solicitors that he would not be able to get a mortgage on the property because of the risk of being liable for the debt. “Understandably, he had to pull out,” said Bell. Other leaseholders in the block have also been unable to sell their homes because mortgage providers are unwilling to lend on any flat in the building. Bell said his neighbours, including families, have been “effectively trapped in unsellable homes” by the council’s inaction. “We’re in this position where we’re trapped in the building as a result of the actions o...
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