SDL Bigwood tried to dump its debts on ‘services that residents did not see being implemented’, claims MP Kelly Tolhurst
Hyde Housing Association raised ‘service’ charges from £85 to £128 a month
London and Quadrant Housing ‘tried to charge for street lamps and street cleaning provided by Medway Council’
Housing minister wants to ‘make it easier to stop unfair fees and exorbitant service charges, and to access effective redress’
In a brilliant day for leaseholders – which will infuriate developers, ground rent speculators, trade bodies and professionals who feed off the vulnerability of the nation’s long-term tenants (aka leaseholders) – the second parliamentary debate yesterday concerned property management.
Government – especially our dear friends, the DCLG civil servants – can’t quite bring themselves to thank or even mention the Leasehold Knowledge Partnership but draw from its programme and data.
The debate was called by Conservative MP Kelly Tolhurst, whose Rochester and Strood constituents are upset by private estate charges.
It can be read in full here:
Property Management Company Fees – Hansard Online
Hansard (the Official Report) is the edited verbatim report of proceedings of both the House of Commons and the House of Lords. Daily Debates from Hansard are published on this website the next working day.
Private estate charges are another area where developers have created an investment asset at the expense of their customers. The management contracts are sold off to speculators and property management companies in the same way that as ground rents.
Ms Tolhurst said the “typical annual fee for new build homes is £2,777, while for older properties it is £1,863”.
The management services provided on these estates are often minimal.
She said: “Many residents of the Chimes and the Pastures estates in Hoo are having ongoing disputes with their new property management company, SDL Bigwood.
“When householders on the estates bought their properties, they were informed that only when the whole of the estate was handed over from Taylor Wimpey and Bellway would they incur property management charges.
“Until then, Taylor Wimpey and Bellway would pay them. Unfortunately, the companies failed to communicate with residents as to when any handover would be made.”
SDL Bigwood then “tried to bring forward debts from its former business for services that residents did not see being implemented”.
Ms Tolhurst said: “There is no onus on the property management company to provide any evidence of the services they are charging for being carried out.
“They merely need to provide end-of-year accounts long after the end of the year.
“Some residents face paying thousands of pounds for a backlog of fees passed on from one of the former companies, with payment demanded by the end of the year.”
“It is wrong that so many people who only want to provide a roof over their families’ heads find themselves trapped and helpless and see their money wasted.
Ms Tolhurst went on to name Hyde Housing Association where estimated service charges rose from £85 a month to £128, and London and Quadrant.
London and Quadrant Housing at Lodge Hill “tried to charge for street lamps and street cleaning, which were both undertaken by the local authority, Medway Council.
“Similarly, charges around sewage collection—later deemed to be out of the association’s remit—were also questioned.
Ms Tolhurst raising these issues will be music to the Homeowners Rights Network, which is campaigning against rip-off estate charges:
Alok Sharma replied
“… if one pays hundreds of pounds for a service, one expects the person providing the service to be a competent, experienced professional who will deliver what has been agreed.
“Currently, however, anyone can set up a business as a property agent, even if they have no experience. Agents are not currently required to have any qualifications, undertake training or indeed be accredited, so unsurprisingly some experts believe that agents are overcharging by as much as £1.4 billion every year, with reports of poor service or even, in some cases, no service provided at all.
“… That is totally unacceptable, and I appreciate the frustration that my hon. Friend’s constituents must feel when paying service charges over which they have little or no say and then, on top of that, finding it extremely difficult to challenge overcharging or a lack of delivery.
“Existing processes for leaseholders to seek redress or decide to carry out their own property management are often lengthy and complex, leaving them at the mercy of agents who are not doing their jobs or, if they are doing them, doing them pretty badly.”
The government has launched a review of property management which ALL leaseholders should contribute to:
Protecting consumers in the letting and managing agent market: call for evidence – GOV.UK
This call for evidence seeks views on the regulation of letting and managing agents and the approaches government could take to implement any such regulation.
“Our focus is on protecting and empowering those who pay for managing agents’ services, including leaseholders. We want to make it easier for them to stop unfair fees and exorbitant service charges, and to access effective redress. We also want to make the process for removing or switching agents much easier.”
Mr Sharma praised the sector for taking “encouraging steps towards self-regulation and sharing best practice”.
This echoes the sentiments of Sajid Javid speaking at the conference of the Association of Residential Managing Agents (ARMA).
SDL Bigwood is in fact a member of ARMA, as well as:
- ARHM (the Association of Retirement Housing Managers)
- RICS (Royal Institution of Chartered Surveyors)
- IRPM (Institute of Residential Property Management)
In fact, ARMA’s self-regulation has fallen apart with the resignation of its former regulator ex-Labour minister Sally Keeble, who claims she was blocked by the trade body from considering a complaint.
Ms Keeble explained at length why self-regulation had failed in a lengthy article for LKP.
ARMA regulator Sally Keeble outlines five areas where statutory regulation is needed in leasehold
Related posts:
ARMA’s self-regulation in disarray after member sues the organisation and Sally Keeble resigns
Now we are told Countrywide is STILL an ARMA member … well, until February 1
ARMA pleads to be on Lord Best’s regulatory working group. It should be. And so should LKP …
More farce than Blackadder’s court martial: ARMA claims its regulator ‘retired’
ARMA regulator Sally Keeble quit ‘after being blocked’ from ruling on Warwick Estates lift shaft fatality
Justin Madders: this could be called the Leasehold Emancipation Bill
Now what was it that the Business Secretary said about members of ARMA?
Master Epstein, I believe he said “They were the good guys” and not the “ Rachmanists being discussed on social meeeja – or summat like that.
Ya gotta ave a larf ain’t ya………
Alok Sharma praises property agents for ‘the encouraging steps towards self regulation and sharing best practice’. What the heck is Alok Sharma talking about. Typical vacuous statement with no examples. Does he read the LKP reports or Court cases.
Alok Sharma along with all 650 MPs are voted in to represent their electorate.
Why is he supporting vested interests of a few versus the many ordinary homeowners.
He speaks with forked tongue and has done nothing so far to give tenants any hope of change or fairness.
When did he praise Agents? It would not surprise me if a large majority of Managing Agents DO NOT have criminal records.
“Alok Sharma had better straighten up and fly right” AND SOON.
Ooops- clarification
It would surprise if a large majority of Agents DID NOT have a criminal record of some sort. Deplorable shower!
Kim, It is but right that I should declare that I too once had a criminal record.
It was Agadoo by Black Lace!
Oh noooooooo. That is a Hanging Offence. ( Shaking the pineapple from the tree beforehand)
Well, well, well, what a good day this is to see SDL Bigwood (formerly CP Bigwood, formerly Curry & Partners) named and shamed!!!! I did not even bother responding to Sajid Javids comments about ARMA having the ‘good guys’ knowing that these were definitely NOT good guys and yet even had a chairman of ARMA from among their ranks!!
All of my posts over the years apply to this company who are STILL ripping us off even now after RTM by trying to pass on debts to us and NOT providing accounts in our handover year!! Kelly mentions residents being threatened with electricity supply cut off. This also happened to us and on enquiring from EDF why it turned out the bill had not been paid for 2 years!! I personally paid the bill and deducted the amount from my service charge that year much to the disgust of Curry & Partners!!!
I am sending all this relevant information to the Gov enquiry along with photographs of the condition the building was in. I just hope they will actually be bothered to read it!!
This sounds so familiar, we could be liveing in the same house. No accounts ever , (and how are leaseholders supposed to challenge service charges without being entitled to audited accounts? Clearly the law is laughing at us)
I also provided photos of the state of the house and paid unpaid bills for the mysterious freeholder. ( they never pay water bills in the reversion for example because it’s too hard for thames water to follow up)
There should be a proper investigation into leasehold exploitation,, the paradise papers are relatively benign compared to what is going on here, by dodgy solicitors, and retarded managing agents.
Only by forming a recognised residents association can leaseholders conduct a proper audit of development accounts., as they can appoint a surveyor/accountant to carry out an inspection.
Where this has been done”administrative errors” have been discovered that have saved leaseholders hundreds of thousands of pounds (even from the largest members of ARMA!).
I am aware of that and we did firm a RTA- sadly though unable to enforce our rights. RTAs have no teeth…the
Even RTMs don’t have many teeth when it comes to enforcing the law!!
We did have accounts up to 2010 albeit we had to keep asking for them several times. Once received they were scrutinised with a fine tooth comb showing up many errors. These were always challenged and even though acknowledged were not corrected despite promises to do so!! Hence we got shot of the managing agent but are still stuck with the freeholder who is a charity The Locker Foundation who absolutely refuse to have any communication with us directly and still use above agents which is extremely annoying!
Are you not able to go RTM as you will definitely know where your money is being spent if you do?!!
apologies if the above comment to Mr M Epstein made no sense. it was typed in a hurry and with fury at all my wasted hours forming a useless RTA. No – we could not get accounts. The managing agents were switched and the ‘new’ managing agent simply said they could not get accounts from the ‘previous’ managing agent. The ‘new’ managing agents, could not produce accounts either. Yes the RTA could ask but could not get.
Ando no, we were under the threshold of being able to RTM. So…
We have very recently obtain Right To Manage on three of our blocks in a development of seven.
Prior to the Triplerose case in 2015 we would have been able to have one operated with just one budget to cover all of our three blocks. Now we need a separate budget for each block so are in the ridiculous position of having three budgets.
Costs are being duplicated such as accountancy fees and health and safety checks, separate buildings insurance etc, leading to much higher overall expenses compared to one budget for the lot.
We also have an issue where one block is funding 6 of the car park lights, another block 3 of the lights and one block not paying for any. So some blocks will have a higher electricity bill than others. A complete nightmare to deal with.
We desperately need to amend the RTM laws so that we can go back to running RTM’s as originally intended in the 2002 Act.
I’ve heard of one development which consists of 6 flats but it is comprised of three separate blocks, with 2 flats in each block. Three limited RTM companies have had to be formed and there are three budgets. Just for 6 flats in total ! The RTM rules are clearly not working.
Anybody know who I should contact about this ? I was thinking of emailing somebody in the All Party Parliamentary Group for Leasehold Reform ? What’s the best way of bringing this to the Government’s attention ?
The best course is to raise the issue with us, giving full details.
It then needs to go to Communities Secretary Sajid Javid and the LKP patron MPs who chair the APPG.
Unfortunately, the right to manage legislation was badly drafted, lawyers won Triplerose for Mr Moskovitz and right to manage in multi-blocks is compromised (although existing RTMs do not need to be panicked into paying dubious intermediaries fees to address the situation).
Admin
What is your suggestion for RTMs already in existence managing more than one block? LEASE could give no answer and the Gov clearly must know about this issue but have not thought out any remedy yet?
Admin, You say “existing RTM’s do not need to be panicked into paying dubious intermediaries fees to address the situation”
I would fully support that assertion(even more especially if the “intermediary” purports to be a “Federation” or might lead clients into believing they are a charity by using a .org domain name)
As I understand it, If a recognised residents association appoints a RICS surveyor/accountant to audit development accounts, the managing agent/ freeholder has a statutory duty to comply. Failure to comply is an offence for which fines can be imposed.
Michael
I think that you have missed my point, with respect.
20% VAT is charged on most expenditure and that is a Goverment directive, shouldn’t leaseholders and Admin be lobbying Government to scrap VAT at 20% for RMCs and RTMs? As I said, it would be a vote winner. However, is the Government willing to lose all of that VAT income for the sake of votes? Probably not,
I would also invite you to comment on the other discussion points I made as above. I would be interested in your opinion.
Seb will tell you that I am a managing agent., just so you know.
10.35pm 29th nov 2017
(I have just tried to reply to another article to you but the Admin system doesn’t seem to allow it. I have a screen dump of it. Am I blocked by LKP or is it just a ‘system malfunction’’?
Anyway, Michael I would rather communicate with you by email and not this medium. What do you think?
Mark
If the Government wants service charges to be reduced why don’t they make all RMCs and RTMs VAT exempt? That would reduce costs by 20% in an instant. A vote winner I’m certain.
The debate lasted 20 minutes.
A point for discussion, why don’t independently appointed RICS Chartered surveyors set annual service charge budgets and not by managing agents?
Should Directors of RMCs or RTMs be subject to Ombudsman redress scheme?
Mark, There already are VAT exceptions for works, provided the managing agent is connected to the freeholder?
For example before their collapse into administration (shortly after they reported another successful year of trading) Firstport (formerly Peverel) had been owned by the Tchenguiz Family Trust so any maintenance was zero rated for VAT as it was deemed to be work carried out by the “Homeowner”
Once the companies were separated as a requirement to escape administration (as part of what was described as a “complex rescue” VAT became chargeable..
This was despite the written assurance from Keith Edgar former Peverel director (and now director of Freemont Property Managers that the administration would have” no effect on residents” Another thing to watch out for concerning VAT are communal electricity supplies.
Because communal utility supplies are treated as “Domestic” the rate of VAT should be 5%. Despite this many though are being charged 20%.. This could be because the managing agent is effectively bull purchasing the electricity and disguising the fact that they are in all reality “selling on” After coming across several Firstport managed developments who found tat they were paying VAT at 20% and having challenged the amount were told that an “administrative error had occurred” they were by and large refunded, I made inquiries about my development.
I was written to by my property manager assuring me that “we were paying the correct rate of VAT” and that “I could rest assured”
I responded that I could only “rest assured” if he showed me an EDF invoice showing the rate of VAT and could tell me if it was actually EDF raising the invoice or Firstport acting on EDF’s behalf?”
Thus far his response has been “I cannot answer your questions, I have referred them to Firstport fora response” He is ignoring my emails!
Our issue with EDF was not the VAT as we were being charged 5% BUT on recent bills were charged 50p a day standing charge!!!
We were treated as a business account until contacting Ofgem consumer affairs to check if this was correct. We are now ‘domestic’ but we wait to see if this makes any difference.
Have you seen the article on ARMA website under news section :-
” Electricity & Gas buying power for ARMA members”? Makes interesting reading.
Michael
I think that you have missed my point, with respect.
20% VAT is charged on most expenditure and that is a Goverment directive, shouldn’t leaseholders and Admin be lobbying Government to scrap VAT at 20% for RMCs and RTMs? As I said, it would be a vote winner. However, is the Government willing to lose all of that VAT income for the sake of votes? Probably not,
I would also invite you to comment on the other discussion points I made as above. I would be interested in your opinion.
Seb will tell you that I am a managing agent., just so you know.
Mark
Michael Epstein
As you know, I am a managing agent. I invite you to spend a week with our management team (no pay I am afraid) to experience what really happens in the life and times of a block managing agent.
Are you up for it? It will enlighten you, I’m sure.
Please oblige.
Mark
Michael
My invitation extends to Sebastian O’Kelly, Mr Bottomley, Martin Boyd etc.
I know that they won’t attend so would expect you to do so, as their representative.
We all look forward to seeing you spend a week with us.
Mark
Mark
Which managing agent are you? Where exactly are you based? How many blocks do you manage?
I ask because I would love to spend a week being enlightened as to how managing agents manage multiple blocks from long distances, how the service charge money collected is held relative to each block, how contracts with electricity suppliers, insurance companies and the like are actually managed to name but a few!!!
Again I ask because having been a director of an RTM Co for 7 years looking after just 22 flats (without any pay) and living on the premises I know it would be impossible to do the job effectively any other way. This is why leasehold has to be abolished and managing agents need strict regulation!!!!
Michael
My property manager had a leaseholder come in to our office (without notice) to express her complaint that her neighbour planted begonias in his own patio area. It was deemed that begonias are not suitable f0r a rural location!
We have spent 1.5 hours on this matter. Who do you suggest pays for the time spent? Agent or leaseholder?
Mark,
I too volunteer to spend a week with your Management team.
What is the name of your Company? I hope you are not just extending the invitation to the chaps?
Please allow us to join your team for a week and we can give an honest account of our experience to LKP .
Who are the ‘chaps’?
I can only accommodate the big cheeses that represent you
Why? Beacause you believe that the “ big cheeses” will not have the time to accept your invitation?
Once again I am asking you for the opportunity to work with your team for a week and really dig in to how the service charges are held including sinking fund for “ Major Works”. The companies relationship with the Insurance broker etc. I feel sure that I would be able to reduce the service charges. I would also like to meet many of the leaseholders and and akn5hem if they are happy with 5he management of the block.
You seem reluctant to give the name of your management company so I shall I find out for myself “ Mark Batty”.
Please Sir gimme a chance to work for you for a week at a London based office.
Dear Michael
There is much discussion at the moment about leasehold flats, as you know.
I also run an estate agency in the city of Nottingham.
We, and my fellow local independent estate agents, are reporting to me that potential buyers of leasehold flats now believe that they are a burden rather than an asset. This is because there are some property commentators in the ‘press’ that are reporting stories that leasehold is a “rip off”. Whilst this may be true in a minority of cases, it is not true in most cases.
The result is that there are less buyers looking to buy flats anymore or if they do at a reduced price. Unfortunately, the ‘press’ that I refer to is making flats less saleable and at reduced prices. The existing owners of flats who wish to sell are being punished by the ‘press’.
I assume that you are are a flat owner and your asset maybe being reduced by the ‘press’ through its reporting of the minority of problematic
Certainly, highlighting problems in the leasehold sector is affecting saleability and values as the ‘press’ is starting to negatively affect the sales market. The ‘press’ may be responsible for this, although unaccountable for loss of leaseholders capital values. Does it care for a good story?
The question is “knowing what you know now, would you ever buy a leasehold flat again?”
I would welcome your views on this aspect.
Kind regards
Mark Batty
You guys….
What’s your opinion on my opinion?
By Jove are you Mark Batty a director of “Walton and Allen” Estate Agent /management / Lettings etc.
It took me all of 50 secs to google you. I shall look at reviews for for company at a later date.
My offer still stands but I shall require luxurious accomadation paid for by your company for both myself and my dog if I have to travel to leafy Nottingham.
Mark
Companies house shows that you resigned as a director of “ “/Walton and Allen Mangement Company” on the 8/th November 2017 . However your comment posted on 29 November 2017 state “ My property Manager had a leaseholder come into our office”. You had resigned as a director by then so what was your role and what was your reason for resigning.
Just interested.
Mark
Having checked you out like Kim it seems to me you have too many fingers in too many pies, ‘Jack (or Mark) of all trades master of none’!! Looking at the reviews for Walton & Allen you appear to do well on selling property BUT not so well on managing them!! Perhaps this is the reason for your concern on the ‘press’ in your opinion starting to negatively affect leasehold sales. It means you losing money!!!
The ‘press’ is definitely NOT the problem Mark infact they are doing a brilliant job in exposing all the things wrong with leasehold and why it should be abolished!!
I also think you have ‘missed the point’ of this website by your comment “I can only accomodate the big cheeses that represent you”. I am not sure who you believe this to be but I can assure you we are all in this together sharing our experiences of leasehold tenure.
Like Kim I would still like to work with your team but my travel will be from Devon.
Hello Lesley,
Do you think Mark is going to invite us to work Pro Bono at his Management company for a week? He has gone awfully quiet…..
Perhaps he has suddenly remembered that his resigned as a director of “ WALTON AND ALLEN MANAGEMENT COMPANY” on 8 th November 2017 and cannot hire staff. WHO KNOWS?.
I find the fact that he seems to have gone to ground most odd.
In addition to my previous comment:
Lesley I have had a thought. Mark has been vociferous in his condemnation of the “ press” has invited Sir Peter Bottomley et al to see what a good job “ his” Management company does in giving a good service to the paying leaseholders.
But wait!,!!!! The reviews I have seen for “WALTON AND ALLEN PROPERTY MANAGEMENT CO” are excoriating.
How can that be if Mark says otherwise? There is surely a dichotomy. Is it possible to copy Marks glowing account for the aforementioned company along with the reviews of the leaseholders and send them to Messrs Bottomley , Javid, Sharma, et al more evidence of the URGENT requirement for STRICT REGULATION OF MANAGING AGENTS and ABOLITION OF LEASEHOLD.
For the sake of balance I shall trawl the internet looking for some positive reviews of the management co.
Hi Kim,
I think Mark has possibly ‘gone to ground’ because he wasn’t expecting anyone to call his bluff by accepting his offer to join his team, so I don’t believe for one minute we will be heading for Nottingham sadly!!
But then again is it really his team or did he jump before he was pushed?!!
The reviews I have looked at are certainly reminiscent of my own experience of our managing agent prior to RTM but then they used to tell everyone how wonderful they were so I think most managing agents must be delusional in their thinking of the service they provide!!!
Dear Mark,
Where art thou? Your silence SPEAKS VOLUMES!,,,
Kim
Hi Lesley
I couldn’t agree more. However I find it most interesting that Mark Batty resigned as a director of “ WALTON & ALLEN PROPERTY MANAGEMENT COMPANY” the same day that LKP’s SDL BIGWOOD appeared. Coincidence? I think we should be told.
Anyway, mark has decided to run away from two women ( You & me) who accepted the gauntlet thrown down to the “ Big cheese’’s who were all men of course!!
Hi Lesley
I couldn’t agree more. However I find it most interesting that Mark Batty resigned as a director of “ WALTON & ALLEN PROPERTY MANAGEMENT COMPANY” the same day that LKP’s SDL BIGWOOD appeared. Coincidence? I think we should be told.
Anyway, mark has decided to run away from two women ( You & me) who accepted the gauntlet thrown down to the “ Big cheese’’s who were all men of course!!