May 26, 2024

Housing minister Brandon Lewis meets Campaign against retirement leasehold exploitation

BrandonLewisBrandon Lewis, the housing minister, this week met the Leasehold Knowledge Partnership / Campaign against retirement leasehold exploitation, accompanied by its patron MPs Sir Peter Bottomley and Jim Fitzpatrick.

The meeting covered the following:

Lease forfeiture: LKP / Campaign against retirement leasehold exploitation says this nuclear weapon of freeholders should be ended as it can give rise to unjustifiable cash windfalls.

No one in leasehold attempts to justify the latter.

The case of the forfeiture of Dennis Jackson’s £800,000 Battersea flat at Plantation Wharf illustrates this.

The freeholder here was set to gain a windfall of £720,000, until LKP / Campaign against retirement leasehold exploitation stepped in to reverse the forfeiture. More here

LKP / Campaign against retirement leasehold exploitation said that it is urgently required to find out data on lease forfeiture from the Ministry of Justice.

This was requested by shadow housing spokesman Emma Reynolds in April, but it was supposedly too costly to provide the information. More here

LKP / Campaign against retirement leasehold exploitation believes the courts grant lease forfeiture more frequently than is widely believed.

LKP / Campaign against retirement leasehold exploitation’s wish list is to end leasehold tenure. Failing that, to ensure that all leases are indefinite in duration and that leaseholders – who overwhelmingly have the majority financial stake in a site – control the management of a block from the start.

The management should not be in the gift of the freeholder.

Leasehold residents need to be empowered from the start, avoiding the need for right to manage – where legislation needs firming up, to stop the incessant legal game-playing to thwart it.

Indeterminate leases would stop developers / freeholders working the system to gain from lease extensions.

Sebastian O’Kelly, of LKP / Campaign against retirement leasehold exploitation, noted the Demos and Legal and General reports on the virtues of downsizing and a healthy retirement housing market.

But retirement leases of 125 years demonstrate how developers, and freehold purchasers, hold the whip hand.

“They won’t catch the first purchaser, possibly not the second one either, but will almost certainly catch out the third or fourth owner, he said.

Retirement leasehold owners routinely fail to extend their leases when they should (before 82 years) and the asset’s value drains away: as developers and the freehold owners knew all along that they would.

The trend of housebuilders to build leasehold houses which would formerly be freehold was deplored by LKP / Campaign against retirement leasehold exploitation.

“This is catching out aspirant first time buyers who have spent many years in rented accommodation, only to find that they are only long term tenants in leasehold,” Mr Fitzpatrick informed the minister.


  1. Our present management agent is a member of AMAR-Q. Makes no difference. Management did not improve. Rather then going through the hoops & farce of complaining direct we are just going to change management provided our freeholder agrees. Transparency forget it. When we ask for a footage of CCTV at first it was no due to data protection until we challenge the agent.

    I have been looking at new builds by Barratt, Berkeley Homes the length of the leases are 999 years even though the completion won’t be till 2017/2018, should they not be commonhold? Some are even 125 -150 years lease. All these new builds are all sold off plan.

    For UK buyers who live & work here after paying off our mortgage hopefully before we retire, we have another burden & that is to find more money to extend our leases should we be unfortunate to have leases under 80 years. Or consider selling up & move to Scotland where leasehold does not exit.

    Retirement homes or over 55 independent homes is a wonderful idea but the financial reward is poor. The exit fees is high. Most property values goes up but retirement home values goes down. Where is the incentive? You can’t have your younger relatives unless they are over 55 staying with you for a short duration like a month or two.

    • Marylin,

      I noted what you said:-

      Retirement homes or over 55 independent homes is a wonderful idea but the financial reward is poor. The exit fees is high. Most property values goes up but retirement home values goes down. Where is the incentive? You can’t have your younger relatives unless they are over 55 staying with you for a short duration like a month or two.

      Chas says:
      What does it state in the lease regarding younger relatives staying for a period? The Managing Agents always use the lease to suit themselves, always check what was written in the lease as the lease is a written contract of how the development can be used by residents.

      Recently £39,000 was repaid (see on this site) as the House Managers Flat Rent was not mentioned in the lease, yet the Managing Agent charged for the use. They settled for half the rent paid which was their choice.

  2. Yes, unfortunately this is the next stage of the con men throughout the property industry rearing their ugly greedy heads and most in government standby doing nothing…. I hope they have good PI insurance…..
    Just found out one new site near me has got Japanses Knotweed which makes the properties un-mortgagable… oh dear… that will be one developer going down the pan then and if they try and say they didn’t know…ooops

    • Posted on About Peverel.

      Price Fixing. What Was It? And Why Did It Happen?

      First, a little understanding of the Tchenguiz business model is needed.

      In essence the property portfolio was built up on borrowed money.

      Tchenguiz realised that if the owner of the freeholds also owned the managing agent, the profits from the managing agents could be utilised to service the the loan repayments.

      In effect, residents would be paying back the loans granted to Tchenguiz, whilst he could spirit the profits off shore in the British Virgin Isles. In a sense it wass a super-sized Buy To Let scheme.

      For a while, this was a scheme that “couldn’t go wrong”. But it did go wrong, horribly wrong.

      Tchenguiz companies had started to default on loan agreements and inter-company cross guarantees.

      As interest rates rocketed to support the loans, so the need for Peverel to increase their income from residents became critical.

      As the holding companies edged closer to financial catastrophe, Peverel eyed up the millions of pounds in service charge accounts (which of course they could not touch).

      What they needed to do therefore was find a method of “liberating” service charge funds, so that they would end up with Peverel.

      Very senior managers at Peverel (many of which now run Freemont Property Managers) had a meeting at which it was decided that Retirement Developments that were around 20 years old could be targeted for the total renewal of Warden Call/Entryphone systems.

      The systems were to be declared obselete and beyond repair and would have to be replaced.

      Of course to benefit Peverel, their sister company Cirrus, would have to win the contract.

      Thus begun the price fixing scandal.

      Working in concert with other contractors, they arranged for those contractors to quote high, so that the Cirrus quote came in lower.

      So arrogant and so sure they would never be caught out, Peverel did not even bother to disguise figures, so many developments were price fixed by a straight 20% difference between the contractor and Cirrus quotes.

      In some cases the contractor quotes came in on Peverel headed paper!

      It is ironic to note that many of the relacement works were carried out by the price fixing contractors (who had been instructed to wear Cirrus uniforms)

      The profits from the price fixing (for work that was probably not needed) were used to support the collapsing Tchenguiz companies.

      Peverel admitted to the price fixing (after an article appeared in the Sunday Times)

      They have offered a “goodwill payment” to some of the affected developments, which is only a fraction of the money they defrauded residents of.

      • The SFO have advised that if any of the following are applicable to a company, it is very probable that fraud has taken place.

        Audit findings deemed to be errors or irregularities.

        Internal controls that are not enforced or often compromised by higher authorities.

        Discrepancies in accounting records and unexplained items or reconciliations.

        Missing documents, or only photo copied documents available.

        Inconsistent, vague or implausible responses arising from inquiries.

        Excessive voids or credits.

        Common names and addresses of payees or customers

        Alterations to documents (such as back-dating)

        Duplications(such as duplicate payments)

        Collusion among employees, where there is little or no supervision.

        One employee has control of a process from start to finish, with no segregation of duties.

  3. Michael Epstein says

    What an opportunity for no win no fees lawyers!
    Just imagine the adverts?
    Have you been mis-sold a Retirement Home? Have you been price-fixed? Have you lost a house manager?
    Come on lawyers! Get To It!

    • This was posted on About Peverel which I believe is very relevant to Campaign against retirement leasehold exploitation AND LKP.

      Following years of disputes between residents of St Georges West, West Drayton, Middx, and the Consort arm of Peverel/Firstport (now known as Firstport Bespoke Properties) Peverel/Firstport via their retained legal gangsters JB Leitch decided to get heavy with the residents.
      So over a period of time they added administration charges in relation to serving a Section 146 notice , which is the precursor to forfeiture.

      This was despite the fact that their could never have been an intention to forfeit, as due process had not been gone through (forfeit being a final step not an initial one). It was also found that at the time the notice was served the residents service charge accounts were actually in credit.

      At the tribunal Peverel/Firstport claimed administration charges of £15,309,83. The judge at the tribunal was scathing in his comments about Peverel/Firstport.

      “We are satisfied that there has been a lack of transparency in the manner in which Consort (Peverel/Firstport) have maintained the service charge accounts. We have found it difficult to ascertain the true state of the accounts” . So, even the Upper Tribunal cannot ascertain the development accounts?

      The Tribunal expressed concerns that previously awarded refunds had not been credited to the service charge accounts. This was before a new managing agent described Peverel/Firstport managed service charge accounts as “meaningless rubbish!”

      The original claim as stated was £15,309,83.

      The Tribunal reduced this figure to £386.

  4. Concerns raised about Peverel/Firstport managing, McCarthy & Stone (M&S)developments.

    The current situation as we understand it, is that New Build M&S developments are not managed by Pev/Port. M&S sacked Pev/Port from all the developments where they owned the freehold.

    M&S have their own Managing Agents, a new M&S managed development may be a better prospect when purchasing a retirement flat, but take heed the value of some past M&S developments were overpriced some up to 40% above resale value???

    Check on the web and at with Estate Agents, beware no one will inform you of this

    In 2004/05 a relative purchased a 1Bed flat from a McCarthy & Stone, built circa 2003/04.

    The Development contained both 1 bed and two bed flats including a resident House Manager.
    As of today they have been without a House Manager for over 12 months. They have the same Senior Area Manager as us at Ashbrook Court.

    Flat Prices in 2004/05
    Bed 1 £139,000
    Bed 2 £188,000

    Flat Prices in 2015
    Bed 1 from £75,000?
    Bed 2 from £129,000?

    House Managers Flat Rent paid by residents £9,00.00 P/A is still being paid by all the residents.
    The House Manager living in the Flat, had been on long term sick from April 2014 before leaving in late 2014. To ensure that a House Manager was seen to be in place a Relief/Deputy Manager visits 2/3 days a week who receives circa £15.00 p/h.

    So not only will they pay the £9,000,00 rent but most of the £15,000 pay for the House Manager may be taken up paying the Relief/Deputy Manager.

    Any residents wish to comment?

  5. The leasehold system has been around for over 800 years and thought to have started after King Richard had called up the land owners to fight in the Holy Wars . In those days, the land owners lease out their estates their serfs to look after their land whilst they were serving their King in the Middle East . The premium paid for the 21 years lease was probably 2 cows and 5 pigs and annual ground rent was probably a few pence. ( no bank notes in those days ) . When the payment of annual ground rent fell into arrears , the only solution for landowner was to forfeit the lease and reclaim the land.

    In modern times, the old leasehold system has been adapted and modified by various legislation in Parliament but there has been no-one in Government or Member of Parliament who recognises the lease is not a” tenure for ownership of residential property” but is really a business contract drafted on unfair terms for the 21st century consumer. Nowadays the premium charged for a new 1 bed property under 125 year lease may be equivalent to atleast 8 times national average annual income and financed by 15-20 % deposit and 80% mortgage . But the threshold for starting proceedings for forfeiture of lease may be started for arrears of £350 which may have been OK in 1900 but we are now in 2015 with a Small Claims Court system operating under the County Court . Every Housing Ministers for past 115 years has never understood the “leasehold system” is written on unfair terms and unfit for 21st century consumer society .

    So we should demand the Housing Minister modernise the outdated forfeiture proceedings by transfer to “Small Claims Court” for any arrears of ground rent and service charge between 3 years and 6 years . Also lobby Government oversight of “residential leases” to be transferred from Housing Minister to Minister for BIS