April 10, 2020

Recognised tenants’ association should be easier to form

… because they can examine the books

recognisedtenantsassociationsLKPLKP / Campaign against retirement leasehold exploitation is very pleased the government has launched a consultation on “Making it easier for leaseholders to gain recognition of a tenants association”.

A recognised tenants’ association has one significant power: it can call in an auditor to examine the accounts.

The government uses the word “tenants”, rather than leasehold owners or residents, because under the law a leaseholder is a tenant. Inevitably, this will cause some confusion government also uses the term tenant to refer to those renting in both the private and social sectors.

Details of the full consultation can be found here.

https://www.gov.uk/government/consultations/making-it-easier-for-leaseholders-to-gain-recognition-of-a-tenants-association

We would urge as many leaseholders managing agent’s and even landlords to respond to the consultation which ends on the 22nd May.

The consultation follows on from work that has been done by LKP / Campaign against retirement leasehold exploitation and others over the last five years. A formal submission was made to Eric Pickles, Secrertary of State at DCLG, on November 2013 asking for this review.

Pickles then replied to Sir Peter Bottomley MP on december 3 2013

The housing minister formally agreed to go forward with a consultation last year.

Our draft proposals to Pickles were supported by the British Property Federation, Which?, Centre Forum, AgeUK, the London Assembly, Sir Peter Bottomley MP, Ed Davey MP, Jim Fitzpatrick MP and Baroness Gardner.

Barrister Amanda Gourlay, of Tanfield Chambers, had kindly helped draft the relevant wording.

LKP had previously engaged positively with Minister Prisk.

http://www.leaseholdknowledge.com/why-does-it-take-60-of-leasehold-residents-to-create-a-tenants-association-and-only-30-of-his-constituency-to-elect-housing-minister-mark-prisk

Many of you also attempted to engage with Grant Shapps in 2010.

Shapps’s standard answer to almost everything was to assert that the existing systems provided sufficient “balance”.
How things have changed. Now officials accept leasehold is a much larger part of the housing market, does have some fundamental problems and must improve in the future.

Please do respond to the consultation and please make sure officials are made aware of the problems you may have faced with the various strategies some landlords and managing agents use to prevent or delay formal recognition.

The proposals of LKP are here LKPproposals

The minister’s reply to Sir Peter Bottomley is here ReplytoBottomley

Comments

  1. 1. The proposed minimum number of tenants to form a RTA should be reduced from 50% to 30%. because if the tenants can muster 50%+ support , they could elect to go for setting up RTM company.

    2. The Government , Ministers and every Civil servant in Housing Department should be asking if the “Leasehold System” is fit for purpose in 21st Century UK when every other country in Euroland has fully gone to Commonhold System.

    3. The transfer of freehold title to an “Associate company” does not require the prior offer of RFR under present rules if the Associate company has related to the freehold company for 2 years. The law should be changed to require RFR to be offered to leaseholders for any transfer of the freehold title because because the existing law is being bypassed by incorporating a dormant company and holding for 2 years which costs less than 50 pds.

  2. Michael Epstein says

    I would go further. I would make an RTA compulsory,so that anyone buying a leasehold property automatically becomes a member. This in turn would make it easier to set up a RTM company. I would also ban the practice of Tri-partite leases, which weaves a managing agent into the lease and makes it harder to remove them.
    Which brings me to Peverel! We know they are re-branding. For example, OM Property Management is changing its name to Firstport Property Management. Yet a close examination reveals that OM Property Management is registered at New Milton with a company number of 2061041, whilst Firstport Property Management is registered at Milton Keynes with a company number of 9143096.
    This means rather than a mere name change, they are completely different companies.
    I wonder what effect this could have for long standing legacy issues, contracts to manage and terms of any leases that they are part of?

  3. If there is a different management company ( different in name and co. number to the one named in the lease and was signing party to covenants made in the lease ) , it means the new company has made no covenant under the lease. Therefore a majority of leaseholders should have a right to choose another company to manage their service charge account. and be custodian of their service charge moneys held in trust .

    Sir Peter and Baroness Gardner should be asked to propose amending the leasehold laws to cover these points :

    ( 1) change of management company when original management company has failed or withdrawn.

    ( 2) RFR to be offered to leaseholders for any transfer of freehold title including transfer of any mortgage facility held by current freeholder company.

    ( 3) Separate service charge bank accounts for blocks at different estates and addresses and covered by the bank depositors guarantee .

  4. Anyone looking for assistance may find help from the Federation of Private Residents Association.

    fpra.org.uk

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