Having read and reviewed quite a number of the organisational responses to the DCLG’s consultation paper on “Tackling Unfair Practices in the Leasehold Market”, I am struck by a synthesis of face value distinct opinions that I would paraphrase as:
“Leasehold is fundamentally fine, Leasehold is essential, Leasehold just needs a wee tweak here and there.”
Together with an unexpected (to me) common failure even to acknowledge that there is an alternative tenure to leasehold operating around the world.
Bland and unsubstantiated assertions
As a leaseholder caught up in the “Unfair Practices”, I find these bland and unsubstantiated assertions quite disgusting, if only for their potential to perpetuate the real world exploitation that is residential leasehold to a new generation of eager home buyers.
How many of these ‘experts’ made representations (I never noticed) to reform leasehold until the government triggered the recent ‘crisis’? Many responses seem unusual in that they limit comment to abuses the government has already marked out. No asking for other abuses to be taken into account?
My leasehold story may not be that unique, but perhaps it does contain a small unique relevance to counterpoint all these assertions that leasehold tenure is, apart from recent scandals, largely defensible, just a few bad apples.
I say this because, unlike possibly the majority of leasehold buyers, I thought I knew a lot about leasehold before I bought into leasehold. In other words, I believed back then what all these organisations are claiming now, that leasehold could not be all bad.
Due to my work at the time, a copy of a magazine I recall as titled the ‘LVT Bulletin’ would land periodically on my desk. This contained reports of recent property tribunal or related court cases.
I’ve just googled the title and see it is, despite the mis-title, a subscription component of ‘News On The Block’. I cannot recall if this was the case back when I got it passed to me, but I am talking about a time before the internet, at least in my situation.
Point is, I read about leasehold problems as fought out in court. Yet I did not leap to the conclusion that all leasehold was exploitative because such a conclusion was irrational on the facts before me. I did not at that time personally have experience of leasehold and knew no-one who had. All I had was the LVT Bulletin.
In other words, at that time I was happy to swallow a seemingly rational concept that a modern democracy would not, and could not, create and allow an essentially scam form of home owning tenure, managed by either an incompetent or cynical industry.
A lease is not home ownership
Somehow I did not pick up on one central contradiction. Namely, that leaseholders may be called owners when they set out to buy that house or flat for sale, but they are really in law merely tenants and own nothing more than a leasehold title. A lease is not home ownership.
I cannot remember my thought process but looking back I think I formed the impression that the very fact a special tribunal court was set up seemingly to protect leaseholder rights, the problems revealed at these tribunals was evidence of worst practice being called to account. Things could only get better.
Is this not what many of these organisations wish to promote now? That leasehold tenure is essentially okay and well managed by professional landlords and their agents? Just a few rough diamonds and a bit of bad practice?
I bought into leasehold with this same naive belief, having routinely read the LVT Bulletin on these terms. It did not cross my mind that, in England and Wales, millions of people like me could be sold flats (or houses) for full market price only to find in reality we have few effective legal rights and protections, and that (certainly in my experience to date) it is the exception and not the rule that landlords and agents are not in it for as much profit as they can extract.
I still recall the shock at learning I was a tenant. And my surprise at each experience of cynical exploitation and denial of rights, and learning that those rights I thought I could rely on (such as a fair hearing at a property tribunal) evaporated like morning mist.
Nowadays I cannot bring myself to think of myself as a homeowner. How can I be a homeowner, even though I paid in full for the privilege, if I cannot put a nail into my wall without fearing it could be a breach of my lease? Everything is vague and a matter of interpretation. Leaseholders could pay barristers for their opinion on a weekly basis and still not be guaranteed that the lease means what it appears to mean.
The worst effect of each failure to reform this cesspit housing tenure is that a new generation of gullible, trusting citizens are trapped.
Far from leasehold ensuring best practice, good and professional management and all the other twaddle I read, leasehold is no more nor less a cynical money spinner. Certainly, I would not employ any of the people I have so far encountered as ‘professional’ managing agents. Accreditation or no accreditation.
The only reason life is bearable as a leaseholder is because we achieved right to manage and could sack a poor agent. Only that way could we ensure that service charges went to maintaining the premises. It does not solve all the problems of leasehold of course. There are still fees and premiums to pay. Freeholders retain rights to act independently to the RTM company. Not many people seem to realise this? We are still waiting to find that apparently common yet surprisingly elusive ‘competent and professional’ managing agent. After six years trying.
Why have I not sold up? My home has devalued too far too fast, and I cannot afford to give it away or -so far anyway- extend the lease under the theological formula as provided in the 1993 Act.
I have resigned myself to accepting I am a tenant not a home owner. It is a bitter pill to swallow having paid as much for my home as nearby freeholds at the time. And despite having paid service charges and, in the last six years, done more to protect the fabric of the premises than the ‘landlord’ ever did prior to RTM. The only ironic upside is that there will be nothing for the government to take when I grow older. Not unless they drop the care threshold a helluva lot.
I have no serious expectation that things will improve. I can’t justify the expense of the LVT Bulletin these days. But I imagine that even if today’s potential buyers were told about the online sources for FTT cases, they probably would not download them, trusting as I once did that those ‘For Sale’ signs are truthful…