Arrangements under which residents take ownership of playgrounds and other communal facilities on new housing developments are "no longer fit for purpose", one industry expert has warned.
The head of Glasgow-based land stewardship company Greenbelt Group said the problems linked to Residents Management Companies (RMCs) are highlighted in a recent white paper from the Competition and Markets Authority (CMA). As things stand, RMCs but the housebuilding industry in "serious jeopardy" and also pose a threat to home owners.
The CMA report highlights problems caused by local councils not adopting the open spaces, playgrounds and other communal facilities on new housing developments, raising further concerns about developments which require residents to pay for the upkeep of these areas in perpetuity.
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“The reality of this situation is, if local councils, with their already massively strained budgets, are forced to adopt these open areas on new developments they in turn will be forced to require huge one-off payments from housebuilders," Greenbelt chief executive Andrew Duthie said.
“This could make a development uneconomic to build, further exacerbating the shortage of new housing, or greatly increase the prices of houses on a development, pushing homes further from the reach of first-time buyers. All of this puts the housebuilding industry in serious jeopardy.”
Mr Duthie said the CMA offers no viable solutions to these challenges, but added that the white paper does highlight the increasing risks homeowners are taking on when forced to own these areas via an RMC.
“This widely-used option gives ownership of the open spaces, playgrounds, woodlands and so on to the residents, which means they are not only financially liable for their maintenance but also bear all of the associated legal risks and liabilities,” he said.
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Mr Duthie said the housebuilding market needs to come together to find a cheaper and fairer way to deal with open spaces now and in the future.
“It is abundantly clear RMCs are no longer fit for purpose, but other affordable ways can be found that protect homeowners and their open spaces whilst providing housebuilders a safe exit from developments allowing the housebuilding industry to provide the new homes we so desperately need," he said.
“It is perfectly reasonable to ask homeowners to contribute towards the upkeep of wonderful open spaces right on their doorstep if this is done fairly and transparently.
"We are now at a major turning point for the industry and this actually represents a fantastic opportunity for housebuilders to lead the way with affordable open space policies that care for the environment, save money for consumers and protect the rights and best interests of homeowners in perpetuity.”
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