I begin by thanking my constituents in Portishead, whose dogged determination not to be treated as supine cash cows has led to this debate, which I am proud to have secured on their behalf. The residents at Port Marine, a beautiful development in Portishead that transformed derelict industrial land into an extremely desirable place to live, bought their properties—some leasehold and some freehold —with an external property management company managing some communal parts. My hon. Friend the Minister will recognise in that tale a situation mirrored up and down the country, with uncertainty about bills and charges at one end of the spectrum and the inability to sell properties that are effectively valued at nothing at the other.
There are two key issues: the variable service charge and the fixed rent charge. I am grateful to Sebastian O’Kelly of the Leasehold Knowledge Partnership, who described the situation thus:
“It is an arrangement cooked up by developers and councils: it means developers have a management company and income stream that they can sell on to management companies such as FirstPort, and the council saves money by not adopting these open spaces. Meanwhile, the often younger buyers of these properties end up paying council tax and the management charges, while older locals often living in more valuable houses pay to the council only.”
The situation is increasingly being described as what it is—namely, a fleecehold.
Residents initially wrote to me about the increase in the variable service charge to levels that they believed were unreasonable. Attempts to gain transparency on the costs go back several years, including a face-to-face meeting between FirstPort and Portishead residents in 2019. The issue affects around 1,000 of my constituents, both freeholders and leaseholders. In effect, residents have complained that the amount they are paying does not match the amount of land being managed by FirstPort or the level of work it undertakes on the Port Marine estate. It has also been difficult to get transparency from FirstPort when residents have requested a breakdown of its costs for managing their properties and land.
On 3 November 2023 I joined constituents representing the Portishead management charge action group, along with two representatives of North Somerset Council and two representatives of FirstPort, for a walk around the Port Marine estate to look at the areas managed by FirstPort and by North Somerset Council respectively. We found that very small areas of the estate are managed by FirstPort, for which it charges at least £440 per annum. That charge seems particularly high and produces around £220,000 of income per year for FirstPort. Ideally, residents would like to see the land managed by North Somerset Council, which looks after large parts of the estate already. Naturally, the council would like to receive a substantial sum from FirstPort to transfer those duties but, with no agreement forthcoming, it is easy to see why my constituents find themselves in something of a trap.