“Land values funding row set to throw Axminster masterplan and relief road plans into chaos”

As reported by Owl a week ago:
https://eastdevonwatch.org/2019/11/29/axminster-master-plan-back-to-the-drawing-board-but-dont-upset-the-developers/

“A row over land values is set to scupper a masterplan that would see more than 800 new homes and the long-awaited relief road for Axminster built.

The Axminster North East Urban Extension masterplan for 850 homes was adopted in January, and also includes employment land, open spaces and community facilities.

It also included the £16.7m north-south relief road that aims to end the severe congestion, pollution and HGVs having to travel on the existing road that runs through the centre of the town.

East Devon District Council had successfully bid for a £10m Homes England Housing Infrastructure Funding (HIF) grant that would be used to help fund the delivery of the crucial new relief road, only for the government agency to change their mind and turn the grant into a loan. …

Outlining the situation in his report, Mr Freeman says that the land owners have been contacted but are unwilling to reduce their expectations.

The Crown Estate who own their land outright advised that the value attributed to their land is fixed by what they actually paid and cannot therefore be renegotiated, he said, adding the land owners whose land is optioned to Persimmon Homes were not willing to entertain this option, stating that if they could not realise their expected values they would simply continue to farm the land and await a more attractive offer in the future. …”

https://www.devonlive.com/news/devon-news/land-values-funding-row-set-3608294

“Farmers convert land back to wildflower meadows in bid to cut carbon” (not East Devon’s Green candidate who has optioned some of his farming land to Persimmon!

What a contrast!

“Matthew Cooke, the Wildflower Farmer, believes a change is urgently needed to counter the influence of supermarkets and processors that demand more for less from the farming community, pressures that drive prices and negatively affect wildlife and the countryside.

With that, the Cooke family has taken the first act to convert their land to wildflower meadow. The family hope this act will be a catalyst for other farmers to return to wildflower meadows to help protect and benefit the environment. …”

https://www.devonlive.com/news/devon-news/farmers-convert-land-back-wildflower-3575277

and

https://eastdevonwatch.org/2019/11/11/east-devon-green-party-candidate-who-is-selling-farm-land-to-big-developers-says-climate-change-is-his-priority/

Vote anything other than VERY GREEN Claire Wright and get Tory.

Persimmon in trouble for unsafe junction in Newton Abbot

“Persimmon Homes have been ordered to close an unsafe junction at a new Newton Abbot housing estate.

From next Monday, bollards will be installed blocking access to Larkspur Drive from and from Mile End Road at the new Hele Park estate.

The junction has been left with a substantially obstructed by a nearby garden wall and as a result is not considered safe. Revised plans to improve the traffic situation between the junctions of Ashburton Road and Applegarth Avenue were approved but never implemented so the planning permission lapsed. …”

https://www.devonlive.com/news/devon-news/persimmon-ordered-shut-unsafe-junction-3499209

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

“Persimmon faces wave of claims that it mis-sold properties with toxic leaseholds”

“Britain’s most profitable housebuilder faces a flood of claims that it mis-sold toxic leasehold properties.

Persimmon made ‘deliberate misrepresentations’ when selling homes on leases, MPs and families say.

They are calling on the developer, which made a £1.1billion profit last year and handed former boss Jeff Fairburn a bonus of £75million, to surrender full ownership of the properties to compensate buyers said to have been misled.

The demands erupted after Persimmon backed down in a court battle over allegations of mis-selling.

In an out-of-court settlement reached last month with Cardiff council, Persimmon agreed to give leaseholders in the St Edeyrns development outright ownership of their properties as a ‘goodwill gesture’.

The defeat has been seized on by campaigners, who say leaseholders across the UK should get similar compensation.

And it comes as the Competition and Markets Authority (CMA) probes claims that housebuilders may have mis-sold leases.

Katie Kendrick, of the National Leasehold Campaign, said: ‘We are hopeful that the CMA and others can now use this example to build a future mis-selling case on behalf of leaseholders.’

A lease grants the right to live in a property for an agreed period, not ownership of it outright. Leaseholders can face extortionate ground rents and fees to make small changes.

The Cardiff case has led leaseholders in Plymouth and Cheltenham to demand they get similar treatment.

Sir Gary Streeter, Tory MP for South West Devon, has warned Persimmon that he will report it to trading standards, complain to ministers and shame it in Parliament if it does not agree.

Persimmon has so far rejected suggestions it should offer similar deals.

A spokesman last night said of the Cardiff case: ‘We firmly dispute the fact that the customers were not aware the properties were being sold on a leasehold basis.’ “

https://www.thisismoney.co.uk/money/news/article-7487335/Persimmon-faces-wave-claims-mis-sold-properties-toxic-leaseholds.html

“Property giants pay bosses £63m while ‘exacerbating housing crisis’ by sitting on enough land for 470,000 homes”

“Property giants have been accused of rewarding bosses for “exacerbating the housing crisis” after spending £63.6m on chief executive pay last year while sitting on more than 470,000 unused plots of land.

The chief executives of Britain’s 10 biggest housing developers raked in a combined £63.6m, earning a median sum of £2.1m, according to figures compiled by the High Pay Centre. Four FTSE 100 companies handed £53.2m to their top bosses in total, a median pay packet of £5.7m.

The 10 firms completed and sold 86,685 homes last year, but hold planning permission for 470,068 other plots of land on which homes have not been built. The UK needs an estimated 340,000 new homes a year to meet demand.

Councils have repeatedly complained of developers taking longer to build on sites which have been earmarked for housing, with the Local Government Association calling for powers that would allow local authorities to seize unused land.

The High Pay Centre said its findings raised questions about whether executives “should receive such vast sums of money, particularly given the many criticisms levelled at the big housing developers regarding the extent to which they are exacerbating the housing crisis”.

Luke Hildyard, the think tank’s director, told The Independent: “Homes are a public good and housing companies are charged with quite an important social responsibility. If the housing companies don’t play their part in delivering enough homes then we have real problems.

“There is something particularly unseemly about people who are supposed to be providing a public good raking in millions or even tens of millions.”

The 10 companies, which are all FTSE 350-listed, paid a combined £150m to chief executives and other directors last year. The four FTSE 100 house-builders – Barratt, Berkeley, Persimmon and Taylor Wimpey – accounted for £131.1m of that sum.

The average UK construction worker is paid £24,964 a year, 89 times less than the median pay packet of the 10 housebuilders’ chief executives, according to the union Unite.

The pay disparity was greatest at Persimmon, where chief executive Jeff Fairburn earned £39m – equivalent to the average pay of 1,561 construction workers – last year. He was forced out of the firm in late 2018 after a public outcry over his £75m bonus.

The pay ratio between Berkeley’s chief executive and the average construction worker was 331:1, at Taylor Wimpey it was 126:1, and at Barratt it was 113:1.

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Labour MP Siobhan McDonagh, who cited the figures during a debate in parliament on Thursday, said the “vast scale of inequality” showed “the British housebuilding industry is broken”.

She added: “In the midst of a national housing crisis, how can it be right, just or fair, for the top housebuilding CEOs to walk away with such astronomical sums while there are workers are seeing their salaries stagnate?

“These companies have a land bank of a simply staggering 470,068 plots but completed just 86,685 homes between them. Is that really a record worth rewarding?”

Barratt, Berkeley and Taylor Wimpey all declined to comment.

Persimmon did not respond to a request for comment.”

https://www.independent.co.uk/news/business/news/property-developers-housing-crisis-homebuilding-chief-executive-pay-ftse-100-a9093676.html

“Fat-cat bosses still rake in 117 TIMES more than an average worker despite a pay fall – and former Persimmon chief earned more in a minute than most made in nearly three days”

“Bosses at Britain’s FTSE 100-listed companies are raking in 117 times more a year than a worker on the average salary of just under £30,000.

Chief executives at the UK’s top 100 companies were paid £3.46million on average last year, down 13 per cent from £3.97million the year before.

Former Persimmon boss Jeff Fairburn was the biggest FTSE 100 earner last year, trousering £38.97million.

Five biggest FTSE earners: Chief executives at the UK’s top 100 companies were paid £3.46million on average last year

Fairburn’s salary for 2018 was 1,318 times more than the median salary of a full-time worker in the UK.

It would take an average worker nearly three days to earn what Fairburn raked in during a single minute, according to Chartered Institute of Personnel and Development and High Pay Centre analysis. …”

https://www.thisismoney.co.uk/money/markets/article-7378481/Persimmon-boss-earned-single-minute-nearly-three-days.html?ito=rss-flipboard

“Persimmon probe steps up a gear as 100,000 people are asked for their views on the housebuilder and its homes”

Owl says: So, a developer gets another developer to lead an “independent review ” into its practices that chooses its particicipants … you COULD NOT make this up.

“More than 100,000 people are being asked for their views on housebuilder Persimmon as an independent review into the company enters its next stage.

Customers, employees, suppliers, trade bodies, local authorities and civil servants will all be contacted on Tuesday in a bid to gather information about customer care and the quality of the group’s work.

The process, which was launched in April, is set to rigorously assess every aspect of the firm’s construction and inspection regime as it sets out to rebuild its image in the wake of controversy over payouts to executives. …

… Clive Fenton, the former chief executive of fellow housebuilder McCarthy and Stone, is providing assistance to the review as an industry expert.

The consultation period closes on September 16, with findings of the review due by the end of the year. …”

https://www.thisismoney.co.uk/money/markets/article-7351969/Persimmon-probe-steps-gear-100-000-people-asked-views.html?ito=rss-flipboard

“Crooks Cowboys and Conmen: MP’s damning verdict on Persimmon over its appalling building work”

“Toxic developer Persimmon was branded ‘crooks, cowboys and con artists’ as yet another scandal unfolded over its shoddily built homes.

Persimmon was attacked in Parliament after a block of its flats was found to be riddled with damp, causing misery for families.

Robert Halfon, Tory MP for Harlow, said he was horrified by the conditions endured by some of his constituents.

During Prime Minister’s Questions he said: ‘Homes built by Persimmon… are shoddily built with severe damp and crumbling walls. In the eyes of my residents, Persimmon are crooks, cowboys and con artists.’

In response, Prime Minister Theresa May said: ‘We expect all developers to build their homes to a good quality standard.

These are homes that people will be living in for many years and they deserve those standards.’

It is the latest blow for Persimmon as it fights to keep its place on the lucrative Help To Buy loan scheme which uses taxpayer cash to support families trying to get on the property ladder.

Furious ministers threatened to strike the company off a list of developers able to sell properties through Help To Buy if it cannot clean up its act. [Owl: if you expect that to happen … dream on!]

The Daily Mail has previously highlighted a litany of defects found by buyers of Persimmon homes, including leaks, exposed nails, doors that do not close and toilets that flushed boiling water.

Roger Devlin, Persimmon’s chairman, has vowed to repair the FTSE 100 firm’s battered reputation after scandals which also saw it blasted for corporate excess due to an £85million bonus paid to former boss Jeff Fairburn.

A new homes ombudsman is being introduced to tackle problems in the industry.

Labour MP Clive Betts, chairman of the Commons housing select committee, said: ‘The regime needs to be very tough and regulators need to be able to fine developers and force them to pay compensation.

The Government needs to be prepared to ban these companies from Help To Buy. Why should taxpayers fund shoddy workmanship?’ It comes just days after a TV documentary revealed Persimmon homes had up to 295 defects.

The company was accused of censoring critics this month when it shut down complaints about its homes on a Facebook page.

Persimmon has faced persistent criticism. In an industry-wide ratings survey, it has failed to win more than three out of five stars since 2015.

Persimmon said: ‘We have apologised to customers in Harlow, where manufacturing defects with a batch of blocks have created problems with damp.

The block manufacturer has agreed that this is the likely root cause of the issue and have offered their sincere apologies.

‘Persimmon has agreed to pay the mortgage payments, bills, and the temporary accommodation costs for affected residents while the problem is addressed.’

https://www.dailymail.co.uk/money/news/article-7258379/Crooks-Cowboys-Conmen-MPs-damning-verdict-Persimmon-appalling-building-work.html?

Tory grandee asks Tory May about Persimmon – gets Tory reply!

“Robert Halfon, a Conservative, says he recently met constituents who moved into Help to Buy homes build by Persimmon. The houses are shoddy, he says. He says his constituents view Persimmon as “crooks, cowboys and con artists”.

May says developers should be building good quality housing under this scheme.”

https://www.theguardian.com/politics/live/2019/jul/17/brexit-tory-leadership-pmqs-boris-johnson-theresa-may-mcdonnell-sets-out-labours-three-strategies-for-ending-in-work-poverty-live-news

Well, that’s sorted then – NOT!

Times: “Persimmon faults are exposed on TV”

“Pressure is about to return to Persimmon, with a television investigation set to reveal more concerns about the quality of its properties and customer service.

Britain’s New Build Scandal, to be aired tonight on Channel 4 as part of its Dispatches series, will feature an inspection of a new Persimmon home that found 295 faults, 70 per cent of which were so serious that they violated building regulations, including a fire door that did not close, leaking sinks, unsealed showers and faulty waste connections.

Britain’s most profitable housebuilder is responsible for one in seven homes sold via the government-backed Help to Buy mortgage scheme and in February became the first to report an annual profit of more than £1 billion. Based in York and a member of the FTSE 100 index of leading shares, it was embroiled in a pay scandal last year when Jeff Fairburn, 53, chief executive at that time, was awarded £81.6 million under a long-term incentive scheme put together in 2012 and linked to dividends and the share price.

Persimmon apologised to the customers featured in the programme, including two whose home was uninhabitable for three months after buying it. “We fully accept that on too many occasions in the past we have fallen short on customer care and we can and will do better,” it said.

Last month The Times revealed Persimmon had removed complaints about the standard of its homes from Facebook after taking over the administration of a group targeting customers on the social media site.”

Source: Times, pay wall

“Persimmon defends shutting Facebook group to ‘gag critics’ “”

“The chief executive of Persimmon has refused to deny that the housebuilder paid to take control of a Facebook group dedicated to complaints about the company before shutting it down,

The Times revealed last week that Persimmon had acquired the administration rights to the “Persimmon Homes Unhappy Customers” group, which had almost 14,000 members. It subsequently shut down the group, deleting years’ of customer posts sharing problems with their homes.

Outraged group members have speculated on other Facebook groups dedicated to complaints that the housebuilder “paid off” the administrator of the group, whose identity is not public.

Facebook does not allow the sale of administrative rights to groups created by users so a payment would have been a breach of the website’s rules.

Dave Jenkinson, chief executive of Persimmon, confirmed yesterday that it had acquired the administration rights to the group but would not say whether it had paid for them. “That’s a private agreement between us and the administrator and that’s not something I am prepared to discuss,” he said.

The FTSE 100-listed builder, which is based in York, has a market capitalisation of more than £6 billion. In February it became the first British housebuilder to report an annual profit of more than £1 billion. It sold 16,449 homes last year, about half of which went to first-time buyers using the Help to Buy scheme, which is designed to boost home ownership. Since Help to Buy was introduced Persimmon’s profit per house has almost tripled, from £22,114 in 2012 to £60,219 in 2018.

The move to shut down the Facebook group has produced claims from customers that it is trying to censor criticism of the company, which is working to improve its build quality and customer service after criticism by ministers.

James Allan, 23, a planning officer at East Lothian council who has complained about problems at his one-bedroom Persimmon flat in Edinburgh, said: “They are taking away the voices of people who have had issues. It’s good to see the experiences of others so you know that you are not alone.”

Mr Jenkinson, 51, said Persimmon had been monitoring the group for several months to address customer issues as they arose in posts. However, he said that in the past few weeks activity on the page had become “much more aggressive” and there were “signs of bullying behaviour” towards staff. He also said the company had found, when checking users against its customer database, that most complainants were not Persimmon customers; some were friends of customers, tradesmen or from other organisations. “We’ve done this for our customers, we’ve done this for the right reasons,” he said.

In a trading update, the builder said that revenue in the first half of the year had fallen as a result of selling fewer homes because it was focusing more on customer satisfaction. It sold 7,584 homes in the six months to the end of June, down from 8,072 in the same period last year. Revenue fell by 4.4 per cent to £1.75 billion. The average selling price rose to £216,950 from £215,813. The housebuilder said that it expected its operating margin for the full year to remain stable at a hefty 30.8 per cent.

Persimmon has announced measures to improve its customer satisfaction levels and build quality since The Times revealed in February that the government was reviewing its access to the Help to Buy scheme from 2021 as a result of allegations of poor standards. It is to allow buyers to retain 1.5 per cent of the value of their purchase until faults are fixed. Buyers of new-build homes who report snags within a week of receiving the keys to their property will be able to withhold a portion of the purchase price until any faults are resolved.

Its customer satisfaction rating has improved in recent months, it said. Mr Jenkinson said: “Persimmon is listening carefully to all stakeholders and making the changes needed to position the business for the future, while maintaining a robust trading performance.”

Last night the shares closed down 23½p, or 1.2 per cent, at £19.64.”

Source Te Times, pay wall

“Persimmon claims ‘around half’ its first-time buyers used Help to Buy as sales slip at the house builder amid quality and service revamp”

£77,000 profit per house, adding £30,000-plus to the cost of a new home, poor quality builds, CEO laughing all the way to the bank with his multi-million bonuses – what could possibly go wrong? Answer: nothing goes wrongfor Persimmon, because this government doesn’t just turn a blind eye, it actively encourages this behaviour by putting developers in the planning driving seat (in chauffeur-driven cars)!

“Over half of properties sold by housebuilder Persimmon in the first six months of this year went to first-time buyers, the group’s trading update reveals.

The group sold 3,082 homes to first-time buyers, representing 52 per cent of all private sales for the period.

Speaking to This is Money, a spokesman for Persimmon said ‘around 50 per cent’ of these first-time buyers used Help to Buy schemes to complete their purchase.

While the proportion of purchases being made via Help to Buy adds weight to criticisms that housebuilders are being propped up by the Government schemes, they appear to have done little to help to Persimmon’s overall performance in the first half of the year….

… Persimmon scored the worst figures of all the major house builders in a recent Home Builders Federation new homes survey.

The firm launched a review of its house quality and customer care functions in April. …”

https://www.dailymail.co.uk/money/markets/article-7212547/Persimmon-claims-half-time-buyers-used-Help-Buy-snap-home.html?ito=1490

Developers holding Help to Buy purchasers to ransom

Just when you think all the juice had been extracted from buyers, another scandal pops up.

“Contracts for new-build homes and the industry-led code of practice that informs them are heavily weighted in favour of the developer. The Consumer Rights Act does not include new builds, giving buyers less protection than high-street shoppers, and each year hundreds of purchasers are left in limbo when a home is not finished in time. They can’t pull out and reclaim their deposit until building works look likely to exceed what’s known as the “long-stop” date – the final date by which a property can be finished, which is often buried in the small print.

This can be up to six months later than the legal completion date cited in the contracts, and the legal completion date is often months later than the estimates given when contracts are exchanged. Most mortgage offers are only valid for three months.

While purchasers are legally bound to the developer’s timetable for the exchange and completion of contracts and face substantial penalties if they delay, developers allow themselves generous leeway.

A completion date only becomes legally binding when the home is ready and a “completion notice” is served, after which purchasers have seven to 10 days to pay up or else face interest charges on the balance.

Nor are developers obliged to pay compensation for delays, unless the developer exceeds the “long-stop” date. Purchasers who have to proceed with the sale of their old home after exchanging contracts, or to rearrange a mortgage when their offer expires, can be left heavily out of pocket. …”

https://www.theguardian.com/money/2019/jun/23/new-build-homes-buy-delay-bill-developers?