Agenda item

Motion: RESIDENTIAL MANAGEMENT COMPANIES

 

Proposer: Cllr Duncan Wood

Seconder: Cllr Mollie Miller-Boam

 

Councillor Wood moved, and Councillor Miller-Boam seconded a Notice of Motion in the following terms:

 

“This Council notes:

The increasing use of private management companies on new residential estates in Exeter to maintain roads, open spaces and shared facilities.

 

That many residents experience poor service, rising costs and a lack of transparency, while having limited rights to challenge or change their management company.

 

That the planning system can shape how estates are designed, adopted and maintained, and therefore has a key role in reducing reliance of private management arrangements.

 

Key reports and evidence on the performance and of management companies, including:

• The findings of the Competition and Markets Authority’s Residential Property Management Services Market Study, highlighting issues with poor transparency, high charges, and lack of leaseholder control.
• The Leasehold Advisory Service’s National Leasehold Survey (2016), which found that 68% of leaseholders had little or no confidence in their managing agents.
• The Law Commission’s Commonhold and Leasehold Reform reports, identifying the need for stronger homeowner rights and fairer management structures.
• The Housing Ombudsman’s Learning from Severe Maladministration reports, which detail systemic failings in housing management and governance.

 

That this is a national issue, and Exeter MP Steve Race has been working extensively with other Labour Members of Parliament to challenge poor performance an lack of accountability under the current system.

 

The Labour government’s commitment to modernise housing law through the Leasehold and Freehold Reform Bill and welcomes its plans for further radical reforms to address ongoing issues faced by homeowners and deliver essential change through the upcoming Commonhold White Paper and planned Leasehold and Commonhold Reform Bill.

 

Beginning of the end for the 'feudal' leasehold system - GOV.UK

 

This Council Believes:

That public areas on new developments, wherever possible, should be designed and built to adoptable standards, so they can be maintained by the City or County Council (or their successor). There appropriate this may require the provision of a commuted sum to fund ongoing maintenance.

 

That when private management companies are proposed, residents should be fully informed at about future costs and responsibilities and accountability of services before any homes are sold.

 

That developers must provide sufficient financial safeguards, including bonds, to ensure essential infrastructure works are completed even if the development or the management company ceases trading.

 

That stronger regulation is required at a national level to protect homeowners where management companies are unavoidable.

 

This Council resolves to:

1.Strengthen the use of the planning system to seek adoption by local authorities of roads, play areas, open spaces and other infrastructure where possible, and to consider the provision of a commuted sum for the ongoing maintenance and management of such facilities, in order to limit reliance on private management arrangements.

2.Ensure due diligence in the in the planning process so that developers have sufficient bonds or other financial guarantees in place to cover the completion of essential infrastructure works.

3.Require developers, through planning conditions or legal agreements, to set out clearly the costs and responsibilities of any proposed management company before homes are sold.

4.Ask the Chief Executive to write to the Secretary of State for Housing, Communities and Local Government calling for stronger national regulation of residential management companies.

5.Work with the Local Government Association and other councils to campaign for reform and highlight the experiences of Exeter residents.

6.Publicise advice and support available to residents who face difficulties with their management companies.

7.The matter of monitoring the implementation of the resolutions be referred to the relevant Scrutiny Committee.”

In presenting the motion, Councillor Wood made the following points:

• people buying homes on new developments were facing rising charges;
• there was a lack of transparency and accountability under the current system;
• some responsibility sat with Devon County Council, but reform was needed at a national level;
• this motion sought the maximise adoption of roads and play areas, and ensure that promised infrastructure was delivered;
• this motion encouraged ongoing maintenance funding, in a fair and sustainable way; and
• would work towards improving outcomes for residents today and in future for buyers.

 

As Seconder, Councillor Miller-Boam spoke in support of the motion making the following points:

• there had been a rapid increase in the rise of private management companies;
• costs were often not made fully clear to residents when they were buying their homes and it was often not clear who was responsible for maintenance;
• Exeter City Council was working hard to support residents but local and national policy needed to be reformed;
• tools that existed already within the planning process could be used;
• this motion was calling for strong safeguards and clear information for residents; and
• it was recommending that this could go to Scrutiny Committee to benefit current and future residents.

 

Councillor Parkhouse:

• in her ward there were several City Council owned public spaces and parks that were well maintained;
• she was going back and forth with a private company regarding the maintenance of a private park without much success; and
• it was not really possible to hold private companies accountable.

 

Councillor Knott:

• some houses that had been built by housing associations had their service charges increase 4 times;
• roads serving homes needed to meet standards for public use; and
• this motion was the start of highlighting this problem and protecting residents.

 

Councillor Harding:

• this was an excellent motion;
• residents were signing up for estate management fees without knowing what there level was; and
• residents should be offered protection and be told exactly what they’re signing up for.

 

Councillor R Williams:

• this motion had been sense checked by the Strategic Directors and Heads of Service;
• Exeter City Council had 85 parks;
• some residents were paying more for access to parks, some of which were closed;
• Exeter City Council carried out regular safety checks on their parks; and
• it was unfair for residents to pay council tax for private services.

 

Councillor Vizard:

• it was clear that there were cases in all wards;
• he welcomed the opportunity for the Council to help with this;
• he also welcomed the fact that the government were underway in creating relevant legislation for this; and
• the Secretary of State for MHCLG was listening.

 

Councillor M Williams:

• there had been lots of development in Pinhoe and Topsham;
• what was happening to the unfinished roads and green spaces on new estates;
• when he was campaigning one of the key issues he addressed was overflowing dog bins in a privately owned park; and
• residents were not bothered with how things got done or who did them, just that they were being done.

 

Councillor Moore proposed an amendment to the motion but was advised by the Lord Mayor that this would not be possible as it was an amendment to the Local Plan which had been submitted and therefore could not be amended.

 

Councillor M Mitchell:

• wanted to emphasise item 6 in the motion and hoped that Exeter City Council would be willing to promote the ability for tenants to work for themselves.

 

Councillor Palmer:

• asked why was this not included in the local plan, and felt that it was not focusing on the cause;
• there needed to be changes to government planning policy to address the cause; and
• it was disappointing that there was not anything included about purpose-built student accommodation (PBSA).

 

Councillor Fullam:

• was supportive of the motion;
• the issue of transparency was vital;
• this would cut costs to the lease holder;
• the price of providing services was high and getting higher;
• there were issues with a current Exeter City Council property where the charge had increase but the maintenance was not being done; and
• this motion was about transparency, realism and putting the onus on the landowner rather than the tenant.

 

Councillor Rolstone:

• it was known that more houses were needed in Exeter; and
• better support needed to be provided for residents.

 

Councillor Pole:

• this was the privatisation of profit and socialisation of loss; and
• thanked the Parks and Green Spaces teams for their hard work.

 

Councillor Read:

• was concerned that this had not been written into the local plan; and
• could this not have been done earlier and included into the local plan.

 

In summing up, Councillor Wood as seconder made the following points:

• this motion was focused on residential management companies;
• this had been stress tested to ensure it was achievable; and
• sending it to Scrutiny Committee would make sure the intentions were achieved.

 

Following a vote, the motion was CARRIED.