Fleecehold

[Goodie]

Not sure if this is a GD type thread, or if it would be better served in home and garden..

This seems to be getting a bit more traction lately, with it possibly being included in the leasehold bill that going through parliament at the moment. It's something that we're tangled up with at the moment, yes I knew it was there when we purchased our home, however within 3 years it's spiralled already. Our smallish new build estate of freehold 35 homes requires a management company with annual fees. Initially these were £100/year, 3 years on and we're not at £383/year with an outstanding bill for works faults with the streets waste water pump at around £15k to be split between properties. It seems that it's quite a widespread thing for new build properties of the last 5 years. Is anyone else feeling the pain of it all?

This is the breakdown of our current annual costs...



All we really see for this is the lawns on the very front of the estate are cut around 20 times per year, and the waste water pump is serviced.

For reference, a BBC of article from today:
Housing estate 'fleeceholds' the next great scandal, Tory peer warns

 

[Goodie]

What a surprise the most expensive item is Management fee, also wtf is an estate sinking fund ?

Apparently it's an ad hoc fund for if any unexpected costs/repairs, it's increased from £400 in 2022, to £1000 in 2023 and now £2000 for 2024. I need to make sure that any interest skimmed from holding that money is returned to the fund and not taken as additional company funds.

The management charge for our flat this year was £4k, so I would happily take your £383 bill

Ours started at £3k 3 years ago when we bought the place, so the increase has been steep realtive to inflation. I have no idea how yours has increased by 300% though

Ouch, that's painful. I can see that there would be some associated costs for a flat, although £3k is a big wedge. Is that London pricing? Kicks paying this out for a freehold detached house, especially when also paying around £2700 in council tax.

*edit* just to add in there is also a disclaimer that the company that is doing the landscaping has a shared director with the management company. Would love to see the tendering process that was put in place for that to remain fair.

 

[Goodie]

I suspect the more publicity this gets the more 'fleeceholds' will turn out like leaseholds that have high ground rent/service charges - i.e. almost impossible to sell. Maybe even worse because in a lot of cases there's literally nothing you can do as the management company is baked into the title deeds .

This has already happened in this estate, one of the neighbours house sale has fallen through twice now because of the outstanding £15k bill.

 

[Goodie]

Just to clarify, the homes are freehold. In order to gain planning permission a management company is appointed to look after the open spaces of the estate so the council doesn’t have to adopt and maintain these spaces themselves.

It’s probably explained a little better in the linked article.

Lord Moylan, who advised Mr Johnson when he was London mayor, blamed councils for abandoning their duties.
"They will accept the additional council tax that is generated by the new properties but they will not take on the responsibilities for maintaining those common amenities," he told peers during the Lords' second reading of the bill.
He added: "I think this is the next great scandal approaching the housing market."

 

[Goodie]

do you think the abdication of sewerage/waste-water responsibility was the council or water board decision, or conspiracy (we're in the same boat, as i say)

I have a deeper rabbit hole for that one. I think it was somehow tangled up to justify the management company further somehow. I did speak to the water board (united utilities) to question the possibility of adoption, however they stated that the pumping station wasn't to the standard that they would adopt. Conveniently.

 

[Goodie]

Such an obvious scam and amazing it's legal. Privatise housing estates, what could go wrong!

Frankly anyone signing up to buy a property with one of these leaseholds where they are obliged to pay a charge that can be arbitrarily increased at any time is absolutely mental

I can get that opinion, hindsight at all of that. I guess rose tinted spectacles of the right house, in the right area why would an arbitrary £100 a year for upkeep of the surrounds be a put off. I guess the advice at the time from the solicitor should have been more meaningful. I have no regrets, we love our home and where we live, just being fleeced on an annual basis is a bit of a kicker with a concern of how far does it go. I can't see it going away any time soon, especially with Gove making the decisions, but also if these area's are adopted by the council, as they should be seen as additional costs.

 

[Goodie]

I've been looking at a plot on a new build Persimmon estate which is currently being built and I've been told there is a £95.68 per year maintenance charge for the upkeep of the green spaces including a weekly litter pick. The property itself is Freehold. I wasn't told if it increases every year or so but I assume it will like the OP's.

I was told by the sales guy it's because the council won't adopt the green spaces/grass verges, only the roads and pavements. I find this quite unfair as all the older streets and estates get all their green spaces maintained by the council yet new estates still have to pay the same council tax.

Also been told that you pay your water/sewage bill to some company called Independent Water Networks and not to the 'regional water authority' for this area. I assume it's just more people with their fingers in the pie making a profit out of everyone.

Then there's the FibreNest which is the only broadband supplier on the estate!

this is pretty much where I was 5 years ago before buying the property. I’ll try and and add in screenshot from google earth later, the frustrating thing in our case is that the green space on the estate constitutes a small token strip of grass at the very entrance, it doesn’t go any further, to cut it with a ride on mower is about 15-20 minutes and it’s done. It’s definitely set up purposefully to milk a bit more money.

As a poster stated above, there’s also a legal pack that you have to purchase if you’re going to sell. I seem to recall that if you want to make changes to your property (freehold) that they can also charge a fee. However I’m not sure how enforceable that is as multiple people have done a lot of work and nothings come of it.

 

[Goodie]

As an example of the mismanagement that can go on with these scams, this was a letter received out of the blue a year or two ago. For which they've only just managed to get repaired and still haven't finalised how much they're planning on fleecing us for. It came to light after this letter than the waste pump unit should have two functioning pumps, so if pump A fails pump B takes the load. It was evident that pump B never functioned, as evidenced on 3 years worth of service reports, so when pump A went pop the only answer was to tanker it. The management company denied responsibility for not acting upon the service reports, they felt it was the job of the company that provided the service. Also evidenced on the repoets was the lifting mechanism to bring the pumps to surface were also broken on all service reports, again ignored when it was an easy fix so that when it went pop drainage was the only answer. Also the companies listed to do the drainage were from companies +3 hours drive away, hence the costs.



The farcical company that we have in place is Trinity Estates, any positive review listed there looks highly suspicious to me.

 

[Goodie]

I'm not sure about dormant companies but it seems to be a new management company is set up per estate managed, rather than all falling under the same overall company.