Alok Sharma was appointed today as Minister for Housing and Planning. LKP would like to welcome Alok to the role.
This now means we have had 6 Housing Ministers in just 7 years. As MP for Reading West he may not have seen quite as many leasehold issues as Gavin Barwell in Croydon, but with 22% of the properties in his constituency being leasehold he will know at least something of the problems in this sector.
With the Minister’s banking and accounting experience, before he came into parliament, it might be enjoyable to be a virtual fly on the wall when he meets his officials.
- “Yes Minister, you are correct we have no effective regulation for billions of pounds of leaseholder funds.”
- “Yes Minister, it is true that there is no enforceable obligation to provide leaseholders with accounts. We thought it was best handled through a voluntary code with no penalties.”
- “Yes Minister, there are no penalties for taking huge commissions and unjustified markups in the leasehold sector, other than that you just might have to give some of the money back if you get caught.”
- “Yes Minister, we have supported a self regulation system for managing agents, which means that those agents who are part of the scheme face higher running costs than those who choose not to be regulated, and there is no requirement to join.”
- Yes Minister, to stand a chance of catching his landlord, the leaseholder would have to be willing to spend their own money and a lot of time taking the matter to the “low cost” property tribunal, where the landlord is entitled to reclaim his legal costs in defending the case, under most leases.”
- “Yes Minister, there is a rule which allows the tribunal to try to stop the landlord passing on some of those costs if they lose. It used to be the case that if the landlord called these costs ‘administration’ he might still pass them on, however after just 32 years the Lords have recently addressed this loophole for us.”
- “Yes Minister, we call it a “low cost” tribunal becasue there are no circumstances where the leaseholder is entitled to any of their costs in bringing an action.”
In 7 years has much changed? Historically we blamed Ministers for being woefully ill-informed with the nonsense they used to write about the leasehold system “mostly working well” and being well “balanced” between the interests of landlords and leaseholders, despite the fact that it wasn’t. With the benefit of hindsight it would appear that Ministers often reflected the views of the civil servants of the time with very similar words used under different political administrations before and after 2010.
Minister no 1 on our list of the post May 13th 2010 Housing Ministers was Grant Shapps. It might be best to say that housing was not his forte.
Minister no 2 was Mark Prisk. Mark is a surveyor by training and was the first to ask whether some of the issues in the leasehold sector might need to be addressed. Just as things began to move forward Mark was moved on. Mark continues to have an interest in housing matters and is a member of the leasehold APPG.
Minister no 3 was Kris Hopkins who lasted 10 months. Like Grant Shapps housing was maybe just not his thing.
Minister no 4 was Brandon Lewis. Brandon was the first of the recent Ministers to stay in post long enough to make some small proposals. He was of course the first Minister who asked civil servants to work with LKP so that we could help them to understand, amongst other things, that we had 4.1 million privately owned leasehold homes in England, not the 2 or maybe 2.5 million that they had previously claimed. A number of Brandon’s proposals for making small improvements are still outstanding.
Minister no 5 was Gavin Barwell. He was the first Housing Minister with an urban constituency who’s office regularly saw leasehold matters. His was the first Ministry that began to consider that things might not be as well “balanced” as officials had been claiming in the past. With Secretary of State Sajid Javid their housing paper looked at fixing our broken housing market.
After years of work, LKP’s campaign on one issue finally got to the top of the pile. New build leasehold houses eventually hit the national press and a problem we had reported for years suddenly became a “new” crisis, with everyone from the Prime Minister down saying that it had to be solved.
So, in 7 years nothing has changed, and yet at the same time everything has changed. The claims that things are mostly working well have all but disappeared and now many more in the sector have come round to LKP’s view that things have always needed to change. Some in the sector are now so keen for change you would never guess they had been so silent for so many years. Nor would you guess that they had worked so hard to support the status quo.
So now the new Housing Minister has an open door to a sector which has finally accepted that much progress is needed in order to have balance and a system that works. There is much work to do.
Leasehold construction now accounts for nearly 50% of new build. In the cities it accounts for a much larger proportion of our housing growth. Little has been done over the years to stop the abuses in the sector. Onerous lease terms have become more prevalent. Things are now so bad that the Minster has to consider the problem of housing blight. The Minister should be aware that the lenders have recently brought pressure to bear on the sector, with the effect that it has now been forced to move on some of the issues that the department has ignored for years.