A Catford couple whose home the council wants to buy and demolish as part of a bigger development claim they have been offered as low as half of its £400,000 value.

Lorraine and Lou Pearmain said they have been offered £235k from Lewisham Council for their house, which is set to be bulldozed as part of the Excalibur Estate project, despite independent valuations putting its worth at £400k.

The couple also had planning permission to build a three-bed brick home on their freehold property – plans which would have increased its value to as much as £600,000.

They are the last freeholders on the estate who won’t accept the council’s offer as part of its plan to replace prefabricated properties built in the 1940s with 95 new properties, 39 of which will be for social rent.

But Lewisham won’t budge in the negotiations and the pair face losing out on hundreds of thousands of pounds, they explain.

A 2010 ballot asked residents what they wanted to happen to the estate.

More than 56 per cent (114 votes) were in favour of the estate’s regeneration while 89 people were against the proposals and 21 did not vote at all.

Since then, many of the freeholders – who were in their 60s or elderly – took offers below the market value, the Pearmains said.

The Pearmains said they spent around £35,000 enhancing their prefab home, which they had owned for several decades, including fitting a new kitchen, double glazing, insulation and oak floors.

Caring for ill family members meant the pair could not start work on the new build, although they renewed their application right up until 2011.

Lewisham also managed to “lose” their planning application at one point before it was renewed, Mr Pearmain said.

And Mrs Pearmain, who is not able to work due to stress related health problems, said she has seen the community she lived in for decades “destroyed” by the forcible sales.

The couple now live a short walk from the building site in a council property and say the process has been a “traumatic nightmare.”

“I have loved living here. It was a beautiful community around here years ago. People would say it was like a holiday camp. People used to maintain their homes. It is tragic what has happened,” Mrs Pearmain said.

The couple say they would move away, but couldn’t buy much with the £235,000 they have been offered.

And the process has been traumatic for many of their neighbours, including an elderly resident, who died three months after he left the estate, and a single woman in her 60s who could only afford to move into a mobile home in Kent, Mr Pearmain said.

And despite vowing to push on for a fair price, including considering the £20,000 cost of going to the Lands Tribunal, Mrs Pearmain said she often feels hopeless.

“I feel like I am going to go out of here in my coffin,” she said.

A spokesperson for the Council said it uses compulsory purchase powers as a last resort, with all but one of the freeholder buybacks agreed by negotiation.

“And every freeholder had the opportunity to instruct their own surveyor, paid for by the council, to negotiate for and advise them,” he said.

 “In addition to an agreed market value, freeholders are paid an additional 7.5-10 percent in compensation plus all their fees relating to the purchase and move.  None of the freeholders have challenged the CPOs.

 “To date, of the 12 former resident freeholders, six have been rehoused by the council. The remaining six have made their own arrangements, but all had the opportunity to be rehoused if they wished. There are six freeholders remaining, five are resident and one is moving into a new build shortly,” he added.

He said council officers helped elderly residents move.

“They work across council departments and with family or friends to make the transition as easy as possible. Officers will also continue to work with all households to agree the market valuation for their properties and assist them with their moves,” he said.