Protecting consumers in the letting and managing agent market: call for evidence
The government consultation on cracking down on abuses by managing agents and letting agents closes today at 11.45 pm
Residents are encouraged to give their views about Rendall and Rittner’s management at Chelsea Bridge Wharf.
Here is my submission to this consultation:
”Any major capital expenditure (whatever definition one wants to use for that – say works totalling more than £50 per household) should require a majority of residents to support it. The current situation, as I understand it, is that for major works to be approved, only a majority of those voting is required. This means that major works can go through which may not be wanted or needed and only have the support of a tiny proportion of residents. e.g. managing agents may consult about major works in a development that has 1,000 flats. Only 20% (200) may respond to a consultation and if 51% of those approve it then that is sufficient. But that is just 102 households, just over 10% of the total households.
This happened at the development where I live (Chelsea Bridge Wharf). The head of the residents’ association, Mr Charlie Garton Jones, who also runs an estate agency on the development, wished to improve the security to the underground garage doors and entry system. There was absolutely no need for the replacement to the doors as there has been virtually zero crime on the development and the community safety officer had advised that the existing doors were perfectly satisfactory, md there was no demand for this from residents. However as Mr Garton-Jones’ clients have very expensive cars (Ferraris etc) and apparently were not satisfied with the existing security , Mr Garton-Jones led a campaign for this which met with a complete lack of resident interest. After a second intensive campaign, involving door to door canvassing, they managed to get around 20% of households to vote and a majority of those were in favour (unsurprising since they had been given totally one sided information and a highly leading ballot form) The total cost of this work was about £750,000 to date and needless to say all of this had to be paid by residents, 80% approximately of whom had not even voted on the proposal.
The managing agents who conducted the ‘consultation’ and vote on the security ‘upgrades’ (Rendall and Rittner) took a fee of 2% on that £750,000 in addition to the standard annual charge which they make. Rendall and Rittner had a direct financial interest in making these works go ahead and the way in which they conducted the consultation with residents was extremely biased and aimed towards making the works go ahead (the consultation letter said that even of residents voted against it was likely that it would go ahead at a later time!).
Once appointed, residents can only change managing agents with the greatest difficulty. Managing agents are appointed by the Freeholder (Berkeley Homes in this case) on rolling contracts, renewed annually with no consultation with residents, let alome their explicit approval. Karen Ann Grey of Rendall and Rittner has told me that residents may not see or know anything about the contract between Rendall and Rittner and the freeholder (Berkeley Homes). This is a poor system of governance by anyone’s standards – no consultation, no scrutiny, and in effect taxation (through extremely high service charges) without representation. Service charges which have in fact increased at well above inflation every year that Rendall & Rittner have been the managing agents.
Because it is the freeholder who pays the fees of the managing agent (after having collected this money from residents) it is the freeholder to whom the managing agent answers: He who pays the piper calls the tune. At Chelsea bridge Wharf, Berkeley Homes has behaved in the most outrageous manner (e.g. in 2016 opening up storage depots used by heavy and noisy vehicles only a few metres for residents homes). Berkeley Homes did not consult with residents about this nor did they have planning permission. Through resident action, these depots were eventually closed down (after more than 9 months of the most gross disruption to our lives). The managing agent, Rendall and Rittner, refused to give any information to residents about this matter because they are of course controlled by Berkeley Homes. In a further outrageous abuse of its power, and with no consultation with residents or impact assessment, when Berkeley Homes decide to open up a small private service road on the development to general traffic, causing massive noise nuisance around the clock a problem which persists up till now. Rendall and Rittner are unwilling to take any action on this and refuse to even enforce the speed limit on the road. Karen Ann Grey of Rendall and Rittner has acknowledged the problem of speeding on the road but has told me that they cannot do anything about it because Berkeley Homes have insisted that they take no action on the matter. What residents want is of no interest to the managing agent and there is no way for residents to hold the managing agents accountable or to replace them if dissatisfied.
As with many apartment developments in Central London, and elsewhere, many residents are based abroad or travel very frequently for work, so that they are away from their apartment for a significant proportion of the year. Many people are on short term tenancies (as many properties are buy to let and indeed a fair number are being rented on short term / holidays lets e.g.. Air B n B type properties), and it is therefore very hard to get people organised.
The ‘’housing ombudsman’’ is a private company whose subscriptions are paid by the members. This organisation has little interest in genuine scrutiny of managing agents and they are dismissive of complaints. They have no power to enforce any action on the managing agent in any case.
Residents are therefore in essence powerless. They have no meaningful input to what the managing agents (Rendall & Rittner) or the Freeholder (Berkeley Homes) do. There are two residents meetings a year, and about 1 hour in each where residents can ask questions. So that is 2 hours a year in total where residents as a group can directly interact with the managing agents. Actions agreed at meetings are not followed up, the notes are censored to omit any difficult questions or criticism of the managing agents and Rendall & Rittner refuse to supply copies of presentations used at residents’ meetings.
In summary, I suggest that legislation should require:
- any major works requires majority of all households (not a majority of those voting)
- residents should be provided with a copy of the contract between freeholder and managing agents
- residents should have to decide on the renewal of the managing agent’s contract annually or every two years and should be able to trigger a review of the contract at any time if there is a majority of all households in favour of that