After Carlex revealed that Hanover had sold 21 house manager flats, the cash-strapped Anchor is proposing to do the same.
Residents at Welland Mews, in Stamford in Lincolnshire, were this morning asked whether they want to continue with a resident house manager as the post is vacant.
If they agree to this a formal ballot will be held, which would require an 85 per cent majority to make the change.
Since the year 2000, Anchor has sold six house manager flats. Carlex is aware that Places for People has sold at least one.
The supposedly not-for-profit housing associations are mimicking a trend pioneered by Peverel / Tchenguiz in 2009 to mine value out of retirement sites by issuing leases on the house managers’ flat. These were then either sold off or heavily borrowed against – when Peverel was taken out of administration in 2012 it had a £25 million loan from RBS secured against these assets.
Peter Whalley, a senior Peverel executive who left the company in July, stated in writing that the company was aware that the sale of the house manager flat could be challenged in court – the argument being that they are a common part of the site.
As yet, no retirement site has mounted a challenge, although Mere and Ash Courts in Knutsford, Cheshire, is where feelings on the subject run highest.
Anchor was asked whether it had taken legal advice over the proposed sale of the flat.
“Legal opinion is not necessary and has not been sought,” it replied.
“The basis in law on which we propose to sell the apartment is that Anchor owns the freehold of the estate. Where leaseholders elect to proceed with a sale of a manager’s apartment, it is appropriate for us to put into effect their democratically expressed wish. We do not believe that a sale in these circumstances is unlawful.”
Unlike Leonard Hackett Court, a Hanover site in Bournemouth, Welland Mews was not built with public money through the Housing Corporation – an issue that may be of major importance if the residents there go to court.
Hanover pays £15,000 into the contingency fund on sale.
The flat at Welland Mews may well be worth around £160,000.
Anchor initially told Carlex that the number of sales was “very small” – but six similarly priced properties amount to nearly £1 million. The housing association’s private retirement leasehold properties are frequently upmarket.
Sir Peter Bottomley, who was party to the Carlex / Anchor correspondence, commented during it: “I am preparing for Parliamentary activity on this and on similar issues.”
In the past, it has been strongly rebuked for high salaries by Parliament.
You would have to be completely daft to accept a £10,000 donation into the contingency fund in exchange for a £160,000 flat.
An alternative would be for the residents at Welland Mews to borrow some money, buy the freehold and then sell off the house manager’s flat themselves. Or, rent it out.
The combined value of the leasehold properties at Welland Mews far exceeds the value of the freehold, so it is absurd to permit Anchor to make proposals of this sort.
It is depressing that so many retirement sites have agreed to ending the live-in house manager service and accept really trifling payment in exchange for the sale of the flat.
It is this incessant cleverness in the retirement leasehold sector at the expense of elderly and vulnerable people that has so drastically reduced confidence in it.