It is true to say that when we first began, we knew what we did not want. Gradually it has become much clearer what we do want:
What we want for all new build estates:
Those with public open space to be constructed to adoption standards, inspected and adopted by the Local Authority compulsorily.
Those smaller developments which have no public open space to be constructed to adoption standards, independently inspected, and conveyed to the residents under common hold with a proper regulatory framework.
A ban on estate residents having to fund the maintenance of adjacent existing green space in perpetuity as part of planning agreements. If developers wish to “donate” these services instead of providing green open space on their site, then they should pay the local authority a commuted sum for maintenance.
Abolition of estate rent charges for residential property – retained for commercial property if necessary.
What to do about Existing Sub- standard estates?
Whilst we DO want to drive up estate quality and give future home owners a fair deal with true freehold, we DO NOT want a whole (very large) group of residents on existing estates being left on run down, expensively maintained estates with devalued properties. Whatever is done, must address the plight of current estate residents who are caught unwittingly in this trap.
The Law Commission is recommending Government look at enfranchisement (that is residents having the right to purchase the freehold of the estate and run it themselves), and whilst this sounds better than the existing arrangements, there are serious snags. The sub-standard construction leading to “un-remedied liabilities” being the biggest obstacle. We would also argue that most people want to enjoy their homes in peace and not have further, possibly onerous, responsibilities placed upon them and the risk of falling out over costs.
So we say it could be a two stage process. Enact enfranchisement, with peppercorn cost for the land and indemnities against defects. Require Local Authorities to adopt these estates at no cost to residents if they as the new land owner ask for the estate to be adopted. Local Authorities can adopt sub-standard now, but are unlikely to do so unless compelled. If this seems unfair on Local Authorities, then do remember that they agreed to the current arrangements with the developers.
When we first started networking together 2 1/2 years ago, we knew what we didn’t want. That is to be unfairly exploited by being forced to pay inflated estate charges to either predatory private companies or inept housing associations. The deeper we dug, the more horrifying the story for ordinary home owners, who were nearly all totally uninformed of what they were buying in to. Continue reading “Adoption Now!”
The future for many home owners on privately owned estates will find them under the hidden burden of what the government call “un-remedied liabilities”.
Developers are not offering estate land and amenities up for adoption, so are free to construct sub standard roads, paths, sewers and landscaping. This saves them a great deal of money. Although there may be agreements about standards via local authority planning departments, the developers know cash strapped councils will not enforce them. We end up with estates constructed to a much lower standard than if they were going to be adopted.
After the builders move off, the land is handed over to their choice of managing agent. Are these agents taking steps to ensure the estate is constructed to a good standard, asking for guarantees or indemnity insurance? We do not believe they are. Why should they, they want more future custom from the developers and they will not be footing the bill for remedial work, the home owners will.
We are already hearing of examples of estates where there have been additional large expenses for remedial work due to poor quality construction.
We believe that more questions should be asked about the handover process. There is a huge conflict of interest and lack of independent scrutiny. It is often the case that the managing agent is chosen by the developer before the first home is built – a rather cosy relationship set up before a Residents Management Company (if there is one) could have any say in the matter.
In the long run, this issue could well turn out to be the most important defect in the private estate model.
Last month we wrote to the Housing Minister on behalf of over 3,500 members pointing out the problems and defects in the private estate model, both for home owners and for the quality of the estates themselves. You can re-read what we wrote here.
Over a month later we received a response from his department which outrageously ignores the main points: a) The fundamental unfairness of a small group of home owners subsidising newly created public open space. b) It suggests Local Authorities are virtually autonomous and not constrained by government policy or funding. Of course they would say that when they have had to respond to the recent petition calling for compulsory adoption. c) There is a total unwillingness even to consider alternative ways of funding estate maintenance. The response is written as if replying to a disgruntled individual, not a large and active campaign group – a bit of wishful thinking on their part? We do not intend to go away, or shut up!
Read to the end and let us know if YOU are reassured that the government intends to look after your interests!
HorNets have not had their feet up in the sun over the summer holidays. We have been busy arguing our case.
Perhaps the most important piece of work has been our letter to James Brokenshire, Housing Minister, in response to his speech on housing at the Policy Exchange in July. You can read the full speech here.
We have taken him to task over his statements concerning quality vs quantity in new house building and the social injustice of our position. The letter is quite long, but we believe that it is the essence of our position on new build managed estates. Click on the image below to read the letter:
We plan to share the contents of this letter to key decision makers, and HorNets may wish to use some or all of it when lobbying their MPs.
The “elephant in the closet” is the poor preparation of estate infrastructure – it is absolutely vital that estate home owners do not have to pick up the tab for this in the future.
Thanks to the efforts of HorNets and members of our sister group, the National Leasehold Campaign, the government petition for compulsory adoption of estates has reached and passed the trigger point for a government response. It is open until September 1st – every signature adds weight to the campaign, so please sign and share if you haven’t already done so.
The petition author, who is an individual home owner like all HorNets was unaware of our existence until the petition really took off.
You can read the story behind it in this article in his local press.
Entitled “The Potholes and Pitfalls of Life on an Unadopted Road” this article is about the modern managed private estates with some case studies of the difficulties home owners face. Home Owners Rights is promoted and the petition we support to make adoption of estates compulsory.
On Wednesday 18th July, HorNet reps joined the National Leasehold Campaign demo outside parliament and later walked with them to 10 Downing Street where they handed in their petition to abolish leasehold. It was great to join such a spirited and well organised demo and to meet with people face to face.
A number of MPs came out to see us all in support including Sir Peter Bottomley and Jim Fitzpatrick co chairs of the All party Parliamentary Group on Leasehold and Common Hold reform. That great champion of exploited home owners, Justin Madders, John Healey, Shadow Housing Minister, and Catherine McKinnell who is very supportive of her HorNet member constituent.
Since our campaign is about estate management, you might wonder what we were doing there when it was a leasehold issue. We believe that all these ways of monetising land and property are interlinked, and that ordinary home owners are being exploited in a number of ways. Many leaseholders also live on managed estates, so even when successful in purchasing their freehold in most cases it will be “fake freehold” with charges attached. They will still not be free of a landlord and own a true freehold.
Stealing a phrase from the NLC campaign “don’t polish – abolish!” we who live on privately owned estates with public open spaces should be demanding compulsory adoption of these areas. Apart from resolving all the injustice and extra hidden costs for the home owners, this would also drive up standards of estate construction, which are currently abysmal and will eventually lead to blight.
Adoption for estates with public open spaces
Common hold for exclusively private estates
Abolish leasehold across the board in favour of common hold
Home owners are subsidising infrastructure provision in their local authority area. How?
Section 106 of the Town and Country planning act allows developers to contribute to local infrastructure where planning permission would otherwise have to be refused. The original intention was to facilitate development of more new homes and provide road improvements, school places, affordable homes and leisure facilities for the new population. In recent years local planners have been using section 106 to provide more and more local infrastructure, arguably not always of direct benefit to the development under question. It is being used almost as legalised bribery to extract as much cash as possible from the big house builders.
It is acknowledged that the commercial house builders are driven by profit and shareholder value, so they are going to do everything they can to retain their profit margins including:
Cost cutting on home quality.
Cramming as many houses as they can onto the development.
Skimping on estate amenities preparation.
Not offering estate grounds/amenities/roads up for adoption.
Implementing the private estate model with unregulated management companies we all know and love!
Unjustifiable sale of leasehold houses with onerous ground rents and onward sale of their freeholds to offshore investors.
Not providing affordable homes via commercial viability assessments.
Home buyers on these estates are therefore purchasing a sub standard home on a sub standard estate and pay unregulated estate charges – effectively a private tax. There is no doubt that future saleability and value of these homes will be affected.
For leasehold houses with high ground rents and doubling clauses, the homes are unsaleable right now.
A HorNet member has researched the topic, and if you are interested, there are links in this document to articles about section 106 use and its damaging effects: S106 Articles Links
The bottom line is that we, the new home buyers, are getting a raw deal as a direct result of the way local planners are utilising section 106.