… But shouldn’t the paid professionals be more than Air Warden Hodges?
There can be few industries where it would be felt appropriate to hold a private meeting to consider customer apathy. There can be fewer still that would seek to blame the consumer for that apathy.
Yet this is exactly what we face today. Managing agents, surveyors, lawyers and government officials will be attending a conference where they will listen to the head of the managing agent’s trade body lead a “think tank” entitled:
How can we address leaseholder apathy?
Paid professionals in the sector are fond of likening RMC and RTM directors to the comical characters in Dad’s Army. Ho, ho they are all ineffectual Captain Mainwarings.
(This would be odd to apply also to the boards of prime London sites, where the building and its leases can be worth hundreds of millions of pounds, and the directors have careers that are perhaps even more glittering than property management, but so be it.)
Then again, if volunteer leaseholder directors are Dad’s Army, does that mean that Nigel Glen, chief executive of ARMA representing the paid professionals, is the carping Air Warden Hodges?
Given that we are nine months on from Grenfell, and a number of other cladding sites face the trauma of potentially enormous costs to the leaseholders, it gives yet more reason why someone should have asked: is such a title is appropriate?
The sector has hardly covered itself with glory in dealing with the cladding issue. Suggesting the consumer may be apathetic hardly seems to help.
We should also remember that the leasehold sector has an appalling history of staging conferences where it has been standard practice to ridicule the customers for their ignorance, while at the same time training agents and landlords to give themselves advantages at the leaseholders’ detriment.
It was always a disgrace that the taxpayer-funded Leasehold Advisory Service was in the forefront of this.
Government only brought LEASE to heal after many years of LKP exposing these events for what they were. No one was fired, of course, there was just a sudden “change of stance”. Now the government gives LEASE even more money to become “wholly on the side of the leaseholder”.
In fairness to Nigel Glen, who is heading the think tank session today, it may not have been his decision to choose the title of the conference.
It is, of course, true that it can be difficult on some sites to engage the leaseholders, but it’s likely that the “think tank” will continue the sector’s long standing view that the blame somehow mostly sits on the consumers’ shoulders.
Perhaps its time to ask: “Does the fault sit with the managing agent?”
Or does the blame perhaps sit partially with the consumer, but mostly with the agent, given they are the ones being paid to undertake their role?
The think tank postulates
- Government direction (Hackitt review; Commonhold; Residents Association) is for more leaseholder participation – how do we achieve this?
- If we cannot get leaseholders sufficiently involved, what are the alternatives?
- How do we ensure that leaseholders/RTM and RMC directors understand the sector and legislation?
What we are unfortunately likely to see, yet again, is the sector’s habit of characterising residents groups and RMC/RTM boards as being run by a series of Captain Mainwarings, which is another aspect of the sector’s lack of respect for the people who pay the service charges, which fund their wages.
It is, of course, true that with 4.4 million leasehold homes some sites will include some challenging individuals, but the sector never seems to look in the mirror and ask whether it should take some of the blame for not doing more to get an efficient leaseholder engagement?
If the leaseholders are Captain Mainwaring and his platoon, doesn’t that mean that managing agents need to be more constructive than Air Warden Hodges?
We are also likely to hear the argument that leaseholders should not be trusted as they will only choose the cheapest agent and they never agree among themselves anyway, that they don’t understand what management of leasehold sites is about.
What the “think tank” is very likely to miss is any input from leaseholders.
The truth is, until recently, the sector was making sure that property managers understood very clearly, it is the landlord who is the client, not the leaseholder. The term “customer” has only come into use to describe the leaseholder in the last 4 or 5 years.
The truth is some managing agents are more than keen to make sure the input from leaseholders is kept to a minimum.
The truth is that almost any leaseholder who wants to engage, and who wants to contact other leaseholders, is likely to face a managing agent explaining why the Data Protection Act (soon to be GDPR) means they cannot help. Over the years LKP has seen correspondence from a wide range of managing agents, solicitors and even government officials, that fails to properly understand the DPA. We have even seen cases where managing agents on RMC and RTM sites have told the directors that they are not allowed to know the contact details of the members and shareholders of their own company.
Perhaps if we change our approach to allowing leaseholders to organise themselves that may help them engage.
Perhaps if we accept that some of the things the sector does actively discourages engagement that might also help. Telling leaseholders in the social sector that they have major works contracts already in place that will run until 2031, as we’ve heard from one local authority, hardly suggests a landlord wanting to engage.
Rather than blaming the consumer perhaps managing agents should try to understand what they can do better to help the customer engage.
Perhaps agents should be more honest in accepting that they face the problem that on the contrary:
- third party landlord clients are often far from keen on leaseholder engagement
- a number of developers would be less than keen for their appointed managing agent to be too active in finding dilapidations in the first two years of a building’s life
- developers often mandate the agent to set a service charge at an unrealistically low level to make the properties easier to sell
- some agents have been rather active in helping advise their developer clients how to “maximise ground rent opportunities”
The government, officials and LEASE should also take some of the blame for having spent years asserting that the leasehold sector was mostly working well when in truth we have always had fundamental problems faced mostly by the leaseholder but also by the agent and sometimes even the landlord. For over a decade officials actively resisted attempts to make it easier for leaseholders to organise themselves. The new officials working to change this should perhaps ask themselves why?
The sector has to do more to solve its own problems, including engagement, before expecting consumers to do more.
LKP set out years ago the basic steps needed. Do more to help encourage residents groups so they can use their individual expertise to engage more constructively with agents. Busy people are only going to spend their time engaging if they think they can have an effective and efficient relationship with the property manager.
Related posts:
57% of leaseholders regret buying their property, says LEASE
Why has it taken so long to regulate the leasehold sector?
Leasehold sector is 63% larger than everyone thought, says DCLG – accepting LKP figures
Leaseholders and the sector react to Law Commission reforms to commonhold and right to manage
Fractures in ARMA’s efforts to regulate the leasehold property management sector
RICS fines Warwick Estates £20,000 over lift shaft fatality – after ARMA ‘blocked its regulator from hearing the case’
‘Corporal Jones’ here saying don’t panic. They don’t like it up them, you see, sir. They don’t like it up them.
As someone famously said recently, blaming apathy of leaseholders for the recognised widespread abuses of the leasehold sector is a needle of truth hidden in a haystack of lies.
Basic logic: what relevance is the alleged apathy or claimed inability of contractually trapped residential consumers to widespread financial exploitation by the so-called professionals in the sector? Is it not the whole point of a professional class to provide a professional service to its consumers whatever the consumers’ ability?
Do you have to be skilled at bricklaying to get a competent builder to build you a reasonable house for a fair price?
Do firemen get to argue that the reason they can’t put out fires is because the public do not know how to?
Do doctors get to claim that the reason they cannot cure illness is because their patients lack medical knowledge?
It sounds to me like an absurd argument from a ‘professional’ sector that is anything but in my opinion, which relishes the historical freedom to act with impunity.
There is truth in the apathy claim. Our recent AGM was attended only by the RTM directors. Meanwhile I am ‘on parade’ almost daily for their benefit because no agent yet appointed has been up to the task. In my experience many flat owners seem to stir themselves only when aggravated enough and then only for their own self interest.
It is a problem that has to be admitted but is not excuse for the scandals of the sector.
I have yet to meet a professional or competent managing agent, whether RICS regulated or an ARMA member. I spend my time correcting and compensating for incompetence or lack of attention even to basic book keeping etc. In my opinion the sector acts in ways that would never be permitted in real professions.
I’m not sure what the point of the argument is anyway? Seems like a burglar blaming their victims for failing to lock their windows?
The answer is to give those who pay all the costs control over who gets to spend the money and to have real regulation of a sector long overdue for sweeping away its widespread abuses.
At present it would appear a managing agent can operate without any fear of consequences whether it becomes or remains a member of a self regulatory body?
Mind, I have no faith in the present government not to listen gratefully to this nonsense and readily agree that the majority of managing agents are ‘good guys’ being let down by apathetic paying consumers.
Only in the twilight world of leasehold.
Dad’s army figures?
That’s quite an insult, but it does speak to one obvious problem. It’s often the retired who have the time to do the double checking of invoices and the uncovering of fraud. Often they’re on limited or fixed incomes and less able to afford being cheated. Odd how the halt and the lame are heroes for their service on occasion, but when they’re objecting to being cheated or demanding proper accountability they’re “Dad’s army” types.
The average age of the directors of my own RTM is 50 something and we’ve been working together for the best part of 10 years. All of us are physically fit. We speak several languages. We have degrees, including postgraduate qualifications, in finance, science, medicine and business (& most of us have MBAs in addition). Most RTM Companies I have had any dealings with are also run by busy professionals who have one thing in common: they don’t like being cheated.
Let me return the compliment.
Our experience interacting with managing agents whom we fired, and whom we interviewed and did not appoint, as well as our understanding from interactions with numerous other residents’ associations and RTM companies is that the MAJORITY of managing agents are, putting it politely, little better then Chaucerian millers. Always ready with a thumb looking for a little bit of extra revenue over and above what they are entitled to.
Kickbacks, commissions, incentives, and “contributions to overhead” are the name of game. The business is simply rife with conflict of interest and corruption, from top to bottom. But… the RTM Companies are at fault?
Fatalism and apathy are common and understandable in environments where the corruption is SO BAD that addressing it seems an overwhelming challenge and even IMPOSSIBLE. That is certainly the case in England and Wales today when it comes to leasehold — the very essence of rigging by the few, for the few.
Many RTM Companies do indeed fail after a few years because the burden of keeping on top of the cheating and the incompetence of corrupt and inefficient managing agents is simply too much for many to cope with. That said, RTM Companies account for only a tiny proportion of leasehold developments, though their numbers have increased in recent years as the reputation of the industry has deservedly collapsed under the weight of its greed.
Change is coming, one way or another.
No doubt many regular readers here had a good laugh yesterday when one of the country’s most prominent freeholders was described in parliament as “too sketchy” to be associated with a business eager to appear respectable. Has the Conservative party never turned away any of his money?
As us leaseholders were unlikely to be able to afford the £325 entry fee to Leasehold 2018, we will never know why the CEO of ARMA thinks we are apathic, maybe he thinks we are pathetic as well.
ARMA refuse to publish a transcript of his speech and the questions and answers session, News on the Block can only be read by subscribers, so most of us will never know. So as far as ARMA, ARHM , LEASE are concerned, apathetic we shall remain.
Why would one pay to attend? Has there ever been a meeting at which leaseholders got advice on how to prevent fraud by managing agents? Deal with overcharging? Management of complaints? Arrears? Etc.
In this unregulated sector, it is leaseholder apathy that has to date allowed unscrupulous freeholders and their in-house managing agents to trample underfoot all criticism in order to protect ill-gotten gains. Aided and abetted by conflicting interests in ARMA/LEASE, this wild west type band of carpetbaggers, vagabonds, and Rachmanist’s has for decades enjoyed free rein for the purpose of exploiting with abandon the plus 4 million gullible and vulnerable leaseholders in England.
Thanks to “the few” this reign of fraud is finally nearing an end. Summer approaches and last gasp efforts from this band of thieves can be to no avail as we await the findings of the Law Commission-13th Programme on Law Reform followed by prompt enactment in parliament from Sajid Javid (put your sun hat on Sajid)
I hope someone addresses the issue of APATHY at this meeting. How is it measured.
It suggests there is no problem and shows the entrenched mindset of authority.
The implication is that if only more tenants at Grenfell had complained about safety at their TMO meetings- non combustible cladding and 30 minute fire doors would have been fitted and the tragedy averted. The official line from councils, housing associations and private landlords is always blame the leaseholder tenants and make them pay.
The apathy starts within the Government Cabinet because Government Ministers think that the leasehold property title is a fair system for the citizens of E&W. The APPG has about 140 MPs joined up but what are the other 510 MPs thinking ???
There is no open recognition that when you purchase a property under freehold title, you are buying the legal ownership . But when you buy a property under leasehold title , you are buying a long term rental contract and your investment in the contract falls to nil value at the end of the lease term.
If there are 6 million leaseholders, their family savings are slowly transferred by the declining term of the lease to the freeholder company . The owners of 6 million leasehold properties will lose their lifetime savings over 99 or 125 years whereas the owners of 6 million freehold properties will gain the benefit of any future increase in value of their property.
The next property that I will buy will be freehold. Laissez-Faire government has no desire to address the problems of leasehold ownership and rip-offs. The Law of Inverse Reverence applies, the more that you have decided not to do anything, the more you talk about it! The government is the Dads Army.
If the leaseholders are Captain Mainwaring and his platoon, doesn’t that mean that managing agents need to be more constructive than Air Warden Hodges?
We are also likely to hear the argument that leaseholders should not be trusted as they will only choose the cheapest agent and they never agree among themselves anyway, that they don’t understand what management of leasehold sites is about”.
What the “think tank” is very likely to miss is any input from leaseholders.
I read the article with interest though I am sure that the directors here are not Capitan Mainwarings our platoon is very constructive and even though intially the Landlord was not happy about the taking over by the RTM he has been very pleased with the results so much so that he has now asked Countrywide (HLM) our managing agent to take over their largest site at Hedon.
I hope that we have our site of 36 apartments well under control and we have a great relationship with HLM who is proving to be extremely good at what they do which could not be said for the landlord . We probably get involved more than the majority of other RTM’s and I agree with your statement the “think tank” should they not ask for the input from leaseholders then how can they come to a meaningful conclusion .
All our RTM members get involved and we all agree , it works very well indeed.
Our mid size development has a so called ‘Dads Army’ of RMC directors. I am one of them.
The reason that it is so often left up to a ‘Dads Army’ of residents is because managing agents are only interested in making money and not effectively managing a site or giving the leaseholders that pay their wages value for money. 99% of my time is spent fixing fallout of poor management by the so called professional ‘managing agent’.
Our ‘Dads Army’ is the only thing that has held our Managing Agent to account and got them to apologise and lower their fees for service failures. Prior to the threat of getting the sack they would have been happy to carry on with contempt for the leaseholders on our site. The reason why it is so hard to get leaseholders to commit to an RMC or RTM is because they see the mountain of work that the rest of us have to do in order to sort out the mess left behind by our Managing Agents!
Some of our ‘Dads Army’ achievements:
-Suss out that our Managing Agent uses an insurance broker that is owned by the same company and based out of the same office. They do not search the whole market for the best insurance policy and only offer options from a few of their ‘select insurers’ and most likely got a nice kickback on taking out our policy.
-Based on the above, we approached an independent broker who managed to reduce our premium by £5k on the best renewal quote from managing agent pet broker. We then had to hash out the renewal details because our Managing Agent suddenly went very hands off after their broker couldn’t beat the renewal price offered. They’d have been more than happy to take care of everything had we used their own broker.
-We sorted out a complex VAT query independently, that resulted in a further £2k reduction on our renewal premium
-We found out our Managing Agent hadn’t taken out Directors and Officers insurance for us despite assuring us they had, similarly they’d let lift inspection cover lapse.
-We fought back on a £15k+ bill for plant room repairs that were a result of shoddy workmanship by the original installers and eventually got the builder to admit liability and cover the costs. Without us, the full amount for putting right our plant room faults would have been charged back to leaseholders.
-We fought to get issues related to handover of utility meters to the RMC sorted and subsequently managed to negotiate a backdated gas tariff that saved our members 33.4% on the per unit cost for heating/hot water.
-We identified we were being billed hundreds of pounds for call outs related to the communal front doors becoming unlocked. A five minute investigation revealed this was due to people pressing the ’emergency exit’ buttons and tripping the door locks. This could be reset by anyone with a tool available for 99p from ebay.
-We identified an issue with a commercial leaseholder making unauthorised building modifications jeopardising the safety of everyone in the building. We alerted the freeholder/Homeground (who has been useless but at least they know). Our managing agent would have been aware of this serious breach had they been doing regular inspections of the internals of the building and they either chose not to do anything about it or were unaware until we raised the alarm.
I could go on and on and on with other problems we’ve had to resolve that wouldn’t have occurred had the managing agent done its job properly. No wonder it is left up to ‘Dads Army’ – any leaseholder who knew how much time I had to dedicate to this unpaid role would run a mile!