Persimmon in the deep, deep manure yet again on leasehold houses

“Persimmon is heading for a bitter showdown with families who claim the housebuilder mis-sold them homes on toxic leasehold deals.

Hundreds of its customers bought leasehold houses and now claim they are trapped by ratcheting rent bills that have made it impossible to sell.

But the company, which is the UK’s most profitable developer, is playing hardball and has told desperate customers that it ‘does not accept’ their complaints.

Along with other developers, Persimmon has been banned from selling leasehold houses after a public outcry.

Persimmon and others were accused of charging extortionate ground rents, some of which rose dramatically over time, along with a raft of hidden charges.

Leaseholders effectively buy the right to live in a property for an agreed period, rather than ownership of it outright.

However, an inquiry by MPs earlier this year found that many leaseholders did not appear to have fully understood the deal.

In a recent row with Cardiff council, Persimmon was accused of mis-selling leasehold homes. It offered residents the freeholds to their properties at no charge as part of an out-of-court settlement.

Campaigners now argue all its leasehold customers across the country should receive similar compensation.

But in a letter sent to customers and seen by the Mail, the company rejected claims householders were misled.

It claimed staff would have explained the terms of the homes to customers during the sales process, that their solicitor should have advised them about it and that mortgage lenders would have also assessed the property at the time.

A separate survey by the Solicitors Regulation Authority also found one fifth of people sold leasehold properties were not even told the difference between leasehold and freehold homes.

MPs called for an investigation into possible mis-selling. They lambasted solicitors for being too cosy with developers and failing to warn clients about the rip-off deals.

Following their report, the Competition and Markets Authority (CMA) launched a probe.

Sir Gary Streeter, Tory MP for South West Devon, accused the firm of telling ‘blatant’ lies to leaseholders in Plymouth, part of his constituency, during the sales process.

A Persimmon spokesman insisted the decision to ‘gift’ ownership to leaseholders in Cardiff was ‘not to do with the mis-selling of leasehold properties’, adding: ‘We firmly dispute the fact that the customers were not aware the properties were being sold on a leasehold basis.

Any suggestion that the decision by Persimmon to gift the freeholds was in relation to mis-selling of leaseholds is false and misleading.’

‘All customers buying leasehold properties are informed by the sales team at the time of purchase that the properties are leasehold and not freehold.’

‘It feels like we have been tricked’

Grandparents Noelle and Alf Lutton bought their five-bedroom home three years ago for £250,000 – but they have still been asking for problems to be fixed

Noelle and Alf Lutton claim the punitive terms of their leasehold home were not made clear to them by Persimmon.

The grandparents bought their five-bedroom home three years ago for £250,000 – but they have still been asking for problems to be fixed.

In addition, they face having to pay £150 in ground rent every year – a rate that increases every decade – and must fork out so-called ‘permission fees’ of £250 if they want to make even minor changes to the property.

They claim they were never told they would have to pay these charges. Former customer services worker Mrs Lutton, 75, says the couple had always previously lived in freehold properties but were not given that option when buying their current home in Market Deeping, near Peterborough.

Instead, they say a Persimmon sales representative verbally promised they could buy the freehold for ‘a couple of hundred pounds’ two years after the initial sale.

But Persimmon later quoted them a price of £3,750. And although it later reduced this to £500, the company insists they would still have to pay permission fees even if they now acquired the freehold.

‘Had we known then what we know now, we would never have bought the property,’ Mrs Lutton said. ‘We weren’t told about any of the fees we would have to pay. It feels like we have been tricked.’

A Persimmon spokesman said: ‘The details of the ground rent, associated fees and covenants were included within the contract and documentation at the time of purchase.

‘Following completion, Mr and Mrs Lutton raised a number of snagging issues with their property. The last one of these is due to be addressed shortly.’ “

https://www.thisismoney.co.uk/money/news/article-7560423/Housebuilder-Persimmon-fresh-row-toxic-leases.html?ito=rss-flipboard

EDDC CEO Mark Williams at loggerheads with Cranbrook Town Council

Unfortunately, the photographs of the correspondence do not copy well, so go to the Cranbrook Town Council website to read (Owl has taken poor but hopefully legible on this site copies should they disappear)

https://www.facebook.com/cranbrooktowncouncil/
Post dated 18 September 2019 at 14.26

A taster …

Council letter

Williams letter:

Battle lines drawn!

The new “sustainable” villages – beware estate rentcharges

Cranbrook has not recovered from the arrangenent where developers imposed charges on residents of their estates for such things as gardening and maintenance. In the end, the town council took over these charges and spread them over ALL residents, many of whom were naturally upset at extra charges they had never signed up for.

https://eastdevonwatch.org/2018/06/25/estate-rent-charges-another-warning-on-new-builds-such-as-those-in-cranbrook/

Now, the new (brutalist architecture) estate developer in Exeter says it will severely restrict parking by having only 185 car parking spaces for 400 homes and residents will need permits to use the spaces.

BUT enforcement of these parking restrictions will be done by “a specialist management company which will patrol the site to ensure vehicles are parked within dedicated spaces and to ensure that non-residents aren’t using the site”.

And who will pay these charges? Just those who have parking spaces or ALL residents? And who will control escalation of the charges?

A correspondent explains why he won’t be voting Conservative on Thursday

Unless your readers live in a new house on an estate they will have little understanding of what happens today.

I moved onto a new estate which had a grassed open area. I was aware that there was some infrastructure to prevent flooding beneath it and knew that I would have to pay a share of the upkeep. I did not fully understand was that it was a public open space which was available for anyone’s use, not just the residents on the estate.

Maintenance charges have rocketed whilst quality of service has been poor. Any talk of with holding service charge payments is referred promptly to debt recovery. The whole system is unregulated and frankly, stinks.

I have dug deep to try to understand how a simple purchase of a freehold house is suddenly caught up in a land charge where I am compelled to pay for maintenance of land owned by someone else.

The root cause of the problem seems to have started with the council. In this case EDDC. As part of the planning condition for the estate the developer had to provide a public open space and a SUDS system to prevent flooding. In all probability it was an attempt by the council to stick their fingers up at the developers and force them to provide facilities for public benefit at no cost to the local authority.

The next stage was to make the developers responsible for the maintenance of the new open spaces. They could either do that themselves or pay a lump sum to the council to maintain it for the next 25years. Clearly the developers were unable to afford that so they passed the maintenance charges on to the residents within the title deeds for each house.

That was very unpopular and most developers, wanting to distance themselves from the problem, gave the piece of public land to a land management company. It seems that none of those companies are regulated and can charge what they like. If you don’t pay their bill they could apparently seize your house. All quite outrageous.

There has been lots of bad press about these land management companies and the matter discussed in Whitehall although the housing minister has taken little interest.

In East Devon our Conservative council has decided to stick their nose in the trough and has decided to offer to take over the public open spaces at Cranbrook and offer to carry out the maintenance of the public open spaces and charge F band houses £370 per annum and H band houses £512 per annum. Both of those figures are in addition to the normal council tax which is supposed to cover supply and maintenance of public open spaces !!

So lets look at this…. EDDC created the problem by insisting that the developer provide the public open spaces which the council had no intention of maintaining. When it all starts to go wrong EDDC offer to take the responsibility over but only by penalising the residents who live on those estates.

To make it clear those public open spaces are available for use by anyone. So maintenance of those public open spaces should be maintained at public expense. The costs must be paid out of council tax revenue.

This mess has been created by EDDC who enjoy a massive Conservative majority. Any proposals are just nodded through without opposition.

I have always voted Conservative in the past but things have got out of hand. Things must change. The public has a chance to voice their opinion in the local elections on 2nd May.

I know I won’t be for any Conservative Councillor and no, it’s got nothing to to with Brexit….”

Developers (“Cranbrook Limited”) still seem to hold all the cards in the town

From Town Council website:

“For distribution – question: What is “Cranbrook Limited” referred to in the last line?

Town Council site:

“The Town Council has been advising previously that we have been chasing the Consortium to release householders from the rent charge deed and yesterday we received the following statement:

“The development partners, Persimmon Homes, Taylor Wimpey and Hallam are continuing to work with their agents to conclude the Estate Rent Charge audit process and Deed of Release on final payment of balances due from each household. Please bear with us as we complete these tasks. We will continue to liaise with the Town Council on this and update you further in due course.”

Whilst we are doing all we can to help progress this matter, the Town Council is not responsible for the development and distribution of the documentation which removes the rent charge deed from individual households – it is and remains the responsibility of Cranbrook Limited.

The Town Council will continue chasing this matter on a regular basis.”

“Estate rent charges” – another warning on new-builds such as those in Cranbrook

https://www.theguardian.com/money/2018/jun/25/footballer-zeli-ismail-rentcharge

Already covered by Owl as regards Cranbrook here:
https://eastdevonwatch.org/2018/01/12/cranbrook-herald-reports-on-estate-rent-charges/

and what had to be done here:
https://eastdevonwatch.org/2018/01/26/cranbrook-estate-rent-charges-to-be-transferred-to-council-tax/

Tonight’s Countryfile: how to rewild a disused quarry – one for Clibton Devon Estates to watch?

“Ellie and Matt are in Cambridgeshire where Matt is looking at a huge project to turn a quarry into the UK’s biggest reed bed. Thousands of tons of sand and gravel are being shifted at Ouse Fen to create the perfect habitat for wildlife.”

BBC1 18.30 hrs