Housing and Planning Bill — House of Lords, 2016-04-20
Topic: Housing
John Lytton (Crossbench, Unknown): My Lords, I support this group of amendments and, in so doing, I declare my interests as a vice-president of the Local Government Association and, more particularly, as a landlord from time to time, with members of my family, of both shorthold and long leasehold tenants Dealing with the first point in Amendment 101, I say from my experience as a practising chartered surveyor that this is a potent area for problems, and I will give perhaps a couple of examples. The first is that for many of these blocks of flats, both large and small, there are a significant number of absentee long leaseholders, so that the occupants of the building are under assured shorthold tenancies or similar short-term occupations. The occupants, because of the nature of their short-term interest, do not really care too much about what happens to the fabric of the building—that is outside the scope of what is of interest to them. The superior landlord, the long leaseholder, is very often absent and equally disengaged from the process. Therefore, there tends to be, as I have come across before, a small proportion of those who are long leaseholders and residents who find themselves unable to do the things that the noble Baroness, Lady Gardner, has alluded to It gets worse, because of course the right to manage is just that, and it is circumscribed in that way. But what if the process of management means making alterations to a heating system that require you to knock a hole through the outside wall, which is part of the freehold, and which therefore go beyond the strict terms of "management"? As the noble Baroness said, if you have a truculent freeholder, that is a potent source of problems in terms of getting essential works done and making sure that the premises as a whole remain fit for purpose I have witnessed over many years the number of measures to try to strengthen the position of long leaseholders in terms of their collective rights of enfranchisement, their individual rights to extend a lease and their right to the collective management of their block. That is all mired in this split between the ownership—ownership of the fabric of the building—and the rights of the leaseholder, meaning the rights of use and perhaps extending to internal, non-structural partitions such as the floorboards, the ceiling boards, the internal plaster finishes of the walls and perhaps the odd window and door. When you are dealing with the management of a property, you have to take a holistic view if you are going to get it right, because all these things are part and parcel of that. As we have tried to dissect "leasehold" from "freehold", we have run into a whole series of problems of our own making. It would be nice to say that we would come up with a different type of tenure altogether but I know that that has been tried and it seems to have run on to the rocks. At any rate, I encourage the Government to take a close look at Amendment 101 because this issue is causing grinding irritation to the reasonable aspirations to manage a building On Amendment 102—the sinking fund for repairs—I fully understand what the noble Baronesses, Lady Gardner and Lady Maddock, said. A roof may need to be renewed every 50 or 60 years, or, if it is a flat roof, every 25 years; a heating system may need to be renewed every 25 years; and there are other things that may have longer discounted life expectancies of one sort or another. If you have buildings with differential tenure, it is axiomatic that the freeholder, or the person responsible for the management and collecting of money to carry out certain work, may have a series of different objectives. If they are assured shorthold tenancies where the tenants are not responsible for contributing to a sinking fund of some sort, that is one thing, but there may be other types of occupier on less than long leasehold who would be so responsible. As the noble Baroness pointed out, when the buyer of a long leasehold is in this situation, it is essential to know that robust processes are in place for procuring that management and that it does not turn up, as I have seen so many times, all in one go. This could be toxic in terms of the transaction of properties because, if there is a rolled-up liability for large capital sums on repairs, a savvy purchaser of a long leasehold interest will certainly be well advised, as I have often been asked, to look into what lurks in the future expenditure, if that information can be found. Very often, one cannot easily find that information because it is with some other body such as the freeholder’s managing agent.