New Build Estate Management

We think this diagram broadly represents the relationships  between different tenures and charges on new build managed estates.

Diagram of managed estate charges
Managed Estate Charges

It is easy to see how central to the whole system estate charges are. Permission fees are common, but not always present.

The diagram graphically illustrates how residents with the least resources (in leasehold flats) end up having to pay more in terms of running costs. A bit like that cheap ink jet printer where the ink costs almost as much as the device. How much has Help to Buy contributed to this exploitative situation?

Leasehold houses on these developments may not be simply about lucrative deals selling on the freeholds and high and doubling ground rent, it is also easier to retain control over the estate, particularly when a property is sold on. The obligation to pay estate and permission charges automatically is transferred to the new owner, this does not happen with positive covenants for freehold houses, so less reliable conveyancing devices are used, like estate rent charges, or a chain of covenants.

“Leasehold to fleecehold” It is also clear to see how, if a leasehold house owner buys their “freehold”, they remain in the fleecehold trap. Many leaseholders are reporting this via our friends at the National Leasehold Campaign.

 

 

 


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