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Gerrymandering Privatopia

This is a scrapbook about the "Street Votes" proposals, cut-and-pasted from things I've written on Twitter.

public

This proposal derails leasehold enfranchisement for a vast number of properties, which entrenches the asset impairments caused by badly drafted leases and freehold transfer deeds.

DMs SB

https://capx.co/boris-has-one-last-chance-at-meaningful-planning-reform-will-he-take-it/

cui:

there is a set of permitted development rights affecting blocks that are <= 3 storeys
this was brought into law with minimal warning as part of the covid19 emergency
as i understand it, the street votes proposal (i read some 50 page doc about this proposal or something similar a few months ago) would have a parallel effect of permitting buildings to be extended upwards in more circumstances
it may be that the new PDRs render street votes redundant
but the effect is that the owner of the building can put two more storeys on top
this constitutes "hope value", and must be purchased by the owners of the flats in a building when they buy the building. it could add extraordinary amounts to the cost of buying out the freehold
to the extent of rendering it unobtainable
the freehold, along with two or three other rights, is necessary for fixing lease defects and transfer deed defects of neighbouring freeholders , which otherwise permit the transfer of absurd monopoly rents to the mgmt companies
the freehold, along with two or three other rights, is necessary for fixing lease defects and transfer deed defects of neighbouring freeholders , which otherwise permit the transfer of absurd monopoly rents to the mgmt companies
i read the PX paper some months ago. i've found it again now, and sure enough:

"The proposal is related to the recently announced Permitted Development Rights (PDRs) to add two floors to detached postwar suburban houses. "

street votes would mean that the owners of flats could be priced out of buying out the rights of the monopoly management company, by the votes of their neighbours
it feels like this needs to be a blog post

SB: It's the residents who vote on SVs, so why would they vote to make life harder for themselves like this?

the residents or the freeholders?
my block is between two streets - one street is half owned by the housing association
the other street it is in a different management company in which i dont have a vote
do HA tenants get a vote in street votes, or does the HA exercise the vote on their behalf?
let's say you've got a block of flats on a street. 12 flats, and 50 other houses on the street. the 50 can then vote for two more storeys, which means the flats have to pay the block freeholder for the hope value of those storeys when they enfranchise. the block freeholder can thus cut a deal with the house owners / residents to gain the value of that
The PX proposal:

https://policyexchange.org.uk/wp-content/uploads/Strong-Suburbs.pdf

at 49.2.2 seems to compensate tenants but not leaseholders. if it's supposed to include leaseholders, then it amounts to a few hundred pounds compensation for a loss of a six figure sum

obviously, the difference could be used to pay off the other voters on the street

SB: ...

remember i am a YIMBY myself, i am just against extortion, monopolies and expropriation

the presence of scruton foundation/francis terry etc in the contributors to the PX paper is very encouraging; but the presence of barratts and grosvenor is worrying, and the absence of any kind of leaseholder representation more woryring still

are you on a deadline for this? i am up to my ears in contract/restructuring crap with companies house, accountants and so on and will be tied down for days, but would really like to do a writeup of my concerns, some of which may be invalid, but i think there is something in some of my arguments

SB: No imminent deadline. Think we're all on the same page here – if you're right, we'll need to tweak the plans to make sure they don't cause problems, and if not we need to be sure that there isn't the risk you highlight.

ok - no imminent deadline is good to hear. would love to help rework the proposal to make it less catastrophic for leaseholders

SB: But to be clear, residents, of all types, get the vote. Freeholders and absentee landlords don’t get votes

which is different from RMCs, where the HA exercises the votes of each property. but presumably, voters can be compensated for voting the right way?
the hope value above my block appears to be about £2m, between 12 flats. the freeholder could easily split that with the more than 12 voters on the street
meanwhile, the 12 leaseholders get evicted so that the foundations of the block can be strengthened
basically, the "huge financial reward" contemplated for places that vote Yes will be six figure negative for leaseholders; where they are a majority on a street, they are protected. where they are a minority, they're very vulnerable
the way to get leaseholders to support this, rather than to fight it to the death, is to protect them from that *PLUS* package it with protecting them from the PDR extension that went through in 2020. genius!