To ask you about your new build estate/maintenance fees

[Conflictedovernewbuild]

We are planning to move from our current money pit home to a new build.

Been reading up on annual estate maintenance fees, the development we are looking at charges this through an ‘estate rentcharge’ which appears to give
the consumer no protection or recourse in case of price hikes or unsatisfactory work. If a resident defaults the company it appears can essentially revert your freehold to a leasehold, known as ‘fleecehold’. Seems some management companies have been selling their contracts to investment companies presumably to profiteer.

We were really invested in this move and honestly feel like walking away because of this.

For those of you in new builds, has this affected you? I’d really like some balance rather than reading horror stories online. We are looking at a David Wilson Homes development in the South.

Ours are First Port, they are awful we're looking to finally replace them we paid £150 in the first year it's more than doubled in year 4. They also send us letters at the end of the year invoicing for extra costs. They barely do anything and our regional manager treats you like dirt via email.

I love our house but we now want to sell it, until something is done to properly regulate these companies I'd never touch another new build.

It's the new leasehold scandal, but happening on most new developments I'm afraid. There's often something in the contract limiting increases for X amount of years but as you say, it's completely unregulated beyond that point.

Puts me off buying a new build.

I was really worried about this when I bought a new build too. It hasn't be an issue at all.
It costs just over £200PA - if I'm honest I don't think I get value for that, on top of paying full whack council tax too. But it's such a small sum in the grand scheme of things I'm really not bothered - worth the pay off for a new, energy efficient house etc.

We pay around £300 per year. I think it does put buyers off when they find out - that's what happened when we bought out new house, so many would be buyers dropped their reservations, probably when their solicitors became aware of it.

Not all new builds do this, I moved into one a few years ago and there are no additional fees

@Greenfairydust

There are a lot of horror stories out there about ''fleece hold'' ..... Also the management company has a say in what you can do with your home (you have to ask permission/pay an admin fee if you want to build a conservatory for example).."

I have shortened your post, but in 1997 I bought a house on a small estate. Clearly all the planning terms and conditions had been approved by the LA planning department and possibly even the planning committees. Freehold - so no management charges, but there was a clause in the initial purchase contract that any "development" changes (including eg a conservatory) would have to be approved by the company (for a fee) before the LA would sign off. Even now 25 years on - and yes I have been in that same house for 25 years on - that smacks to me of an issue. The LA needs to object to these clauses - why dont they? I would take it up with your local councillor and the planning dept. They are also majorly at fault here. (but its all about the fees - follow the money...)

Thanks all. Going to have a read of the Commons briefing. The sales office have offered to put us in touch with someone in HQ to discuss in more detail. Glad we found out about this at any early stage and based on your experiences I currently feel it is best to walk away.

Ours are written into our dreads caloric at £340 a year. Last year it was £180 and I save my boy il tax amount in the 2 free months to ensure I can cover it.

My mum has been in her ex council house for 50 years and is getting charged maintenance fees now when it was never billed before as the court firm can’t afford it. The residents are all refusing to pay it, so I think it might become more common for these charges
to start cropping up.

We live in a new build development and the estate management fees are about £34/month this year - it’s gone up by about £50 over the course of four years.
We have resident directors who liaise with the management company and scrutinise every invoice. They sacked one company(Firstport) for a terrible level of service and no transparency of charges and it’s been fine subsequently.
There’s no way around it is there? If local councils won’t adopt new developments then the maintenance has to be paid somehow.

We were in our first new build for 9 years and it was around £200 a year. It annoyed me because they did a shit job and the play park wasn’t even usable for half the year. In another new build now, much smaller estate, no park. Still pay around £200 a year which seems a lot for the few grass verges that get mowed but I do love the house and the estate so am hoping it doesn’t go up. My current house is about 8 years old.

Beal Homes, £130 pa.

We pay maintenance fee. I'm not thrilled about it (in principle) but in reality it's been fine.

It's been £18 per month every month for about 6 years. Houses here sell very quickly so it's not been putting anyone off buying - that I can tell.

Each year we get a statement on what the money's been spent on.

Blood homes - all the homeowners have a £1 share in the company that owns the communal areas. The board of directors is made up of homeowners and they make the maintenance decisions and set the charges. We pay £295 per year, but some of our communal areas are listed (landscape by capability brown), we have multiple TPOs and are required to maintain specific planting. However, this does mean we have lovely communal areas.

Hmm damn autocorrect should be Bloor homes not blood.

We pay just over £100 which includes maintenance of our residential car park (and an extra space) plus maintenance of communal facilities like the kids playgrounds it's a development of 8000 properties!

£100 a year that is

I'm a solicitor. You are right to be concerned about a rent charge.

There is also a distinction between a regular service charge and a rent charge which you appear to have identified.

I do think there is a risk that these homes will not be acceptable to mainstream lenders in the future, depending on reforms.

At the very least you need to ensure your solicitor makes a s121 exclusion - speak to them about this.

Not a new build but we lived in a flat with the exact same clause. The management charge nearly doubled in the 4 years we were living there. We had a damp problem caused by poor render that the management company admitted but refused to fix. We were constantly charged extra for things because they were spending the sinking fund on expensive contractors (probably their mates). It was a nightmare, I was so relieved to get out.

On the other hand my friend’s estate charges have only increased with inflation, her estate is beautifully kept and the management company responsive.

I won’t be taking the risk again though. Thats the problem, lack of oversight/regulation.

We don’t have any estate charges/maintenance charges for our new build. We wouldn’t have bought one if it had. Trouble is, you never know if it’s going to go up and what to.

I posted previously asking about management company charges. Just got our annual financial report and even though no remedial work was done to any of the properties, the sinking fund for repairs/maintenance has £0. When I queried who owned the unused funds there was no reply. I would avoid buying any property with maintenance by a management company.

@MigsandTiggs - we used to have the same issue, someone was laughing all the way to bank and was not the leaseholders.

We pay £40 a month maintenance/service charge. We’ve only live here 6ish months so haven’t really seen where this is actually spent yet.. but I much prefer paying that than the absolute shithole we were sold in 2018.

"fleecehold" is generally when you get ridiculous charges for example maintenance or ground rent which is scheduled to double every two years or so after the first 10 years.

Most of these agreements were pushed through on new builds by the seller using their own solicitor, because if you got your own solicitor they would instantly spot the bad clauses and alert the buyer to the consequences.

The key to all of this is if you are considering buying new build, use your own solicitor, or at the very least get an independent solicitor to look over the contract for you.

There's not much wrong with small maintenance charges that can rise with inflation (unless we hyperinflate of course!). There's a lot wrong with crazy stuff like after the first 10 years the ground rent can double or increase by 1k every two years.

@Conflictedovernewbuild in your original post you mention rentcharge. Rentcharge is very much different from ground rent or maintenance charge and it's to be avoided at all cost. Google it all up. Lots of banks will also refuse mortgage if there's a rentcharge. I would never ever consider such property.