Common Ownership in Scotland: A Maintenance Proposal

By David Gibbon – – RICS Conservation Accredited Building Surveyor 

This paper proposes a new approach to the maintenance of tenemental property in Scotland.

Sustainability of Buildings in Common Ownership

The adage “the greenest building is the building you already have” should be kept at the front of policy makers’ minds.

Buildings in common ownership represent a major part of the built environment of Scotland.  According to the 2013 Housing Condition Survey tenemented dwellings comprise 25% of the total stock, rising to 38% if “other flats” (such as four-in-a-block) are included.  Of course not all tenemental units are residential.  There is a considerable number of commercial and other premises too. It is fanciful, unrealistic and environmentally unsound to imagine that more than a very small proportion of these buildings can or should be replaced even in the very long term and with good maintenance policies there is no reason why they should need to be. The idea of using precious natural resources to replace the whole of the built environment at intervals is completely unsustainable.  The planet will not yield the resources of non-renewable materials and energy required to do so.

For the most part we have no realistic alternative but to maintain and gradually adapt and improve the stock of buildings we already have. Our existing built environment is, in fact, a great and generally much-loved resource that we cannot afford to squander. If we allow the incremental decline of our building stock we are simply building up a deficit over time that will have ultimately to be made up at much greater cost than keeping on top of it.

If we allow our existing building stock to decline we are potentially wasting far more embodied carbon and other forms of energy than we could ever hope to save through energy conservation and the impact of Energy Performance Certificates, as well as creating the conditions for social decline and all the associated costs to the State.

Problems for tenemental owners in maintaining the common parts of their buildings

Owners of tenemental property face a number of particular difficulties in arranging the repair and maintenance of the common parts of their buildings:

• Lack of leadership and trust amongst owners
• Difficulties in establishing names and contact details of other owners
• Uncooperative co-owners
• Absentee landlords
• Disagreements as to the appropriate scope of works
• Disagreements about how to share the cost of works

In Edinburgh these difficulties were both overcome and exacerbated by City of Edinburgh Council’s now discredited Statutory Notice scheme.  They were overcome by giving council officials uncontrolled powers to intervene in the private property affairs of its citizens leading to corruption, mismanagement and the widespread misapplication of Statutory powers.  The net result of the demise of the Statutory Notice system has been a) a financial catastrophe and a loss of trust for Edinburgh and b) a population that is out of the habit of co-operating in a neighbourly manner.

The Edinburgh approach resulted in some overall benefits to the fabric of tenemental buildings, albeit at a totally unacceptable cost.  Elsewhere in Scotland the standard Factoring arrangements (in the absence of other forms of reinforcement) are generally seen to have failed to deliver well maintained traditional tenement buildings.

The Home Report – a missed opportunity

The Home Report could hold the key to the effective repair and maintenance of tenemental property in Scotland.  A major improvement to the maintenance and repair of an important part of the historic built environment could be achieved with some relatively minor tweaks to the present Home Report.

The Home Report, as it is presently configured does not address the issue of common liabilities and is actually misleading as to the extent of survey carried out and very often falsely reassuring about the condition of Common Parts.  The impression given by the obligatory standard wording is that the surveyor has inspected the roof whereas in most cases the 3m surveyor’s ladder rule means that the surveyor has not gone near the roof and in any case the level of detailed survey required in the case of a tenemental survey is not within the remit of a surveyor carrying out a Home Report.

The common repairing obligations that go with tenemental ownership can be extremely onerous.  If new owners went into it with a clearer idea of what they were letting themselves in for it would put pressure on existing owners to cooperate in the provision of effective maintenance management arrangements.  Such an approach will not turn matters around overnight but if there was a standard that people could aim at that would make their properties more readily saleable and worth more, it is self-evident that owners would respond positively over time.

In introducing this to the Home Report it is important not to undermine the basic purpose of the report – to simplify and facilitate the purchase of residential property.  It would be a retrograde step to insist that every Home Report on an individual flat includes a detailed report on the common fabric of the building as a whole.

However it should be obligatory to include information on the condition of the common parts including what maintenance is estimated to be required at what cost and when.  If this information has not been gathered by the common owners, this fact should be clearly recorded in the Home Report and will suggest to the purchaser the need for further due diligence.

Quinquennial reports

The “Gold Standard” would be that every tenement should have a Quinquennial survey report with costed and prioritised recommendations followed up by professionally specified and monitored works to implement the recommendations of the report.

Quinquennial surveys are widely adopted by property owners and managers with a long term interest in property as a means of planning maintenance and repairs.  One of the difficulties of tenemental property ownership is the conflicting interests of those with a short and a long term interest.  By stepping back the author of a Quinquennial Survey can help to plan the maintenance of a building over the longer term and this in turn can point the way to the establishment of a sinking fund that means that the burden of accrued repairs does not all fall on the shoulders of a particular generation of owners.

The Property Questionnaire in the Home Report

In the property questionnaire there should be sections that require the seller to confirm whether there are:

• Clearly defined and consistent deeds accepted by all the owners or a Tenement Act scheme adopted by the owners
• Up to date contact details of all the owners in the block or their appointed agents available to all the owners
• A clear apportionment of liability on change of ownership (solicitors and the Land Registry would need to sign up to clear cut arrangements)
• A management committee that meets regularly and whose Minutes are available
• A Factor
• Evidence of quinquennial inspections and reports carried out by suitably qualified professionals in accordance with an agreed template
• A sufficient sinking fund having regard to the recommendations of the Quinquennial
• Evidence of professionally supervised works carried out in accordance with the recommendations in the Quinquennial
• A log book of maintenance works

An EPC-style rating for tenemental maintenance management?

From this information it might be possible to derive a rating along the lines of the EPC rating that would instantly inform a prospective purchaser about the status of the common parts.

Many properties (perhaps most) would not come up to this standard in the first instance.  As with poorly rated EPCs they could still be bought and sold but the pressure would be on for incremental improvement.

Over time particular pressure might be brought on Landlords who are often the least co-operative.  The Government could introduce measures similar to those that will apply to units that have poor EPC ratings and announce a future intention of preventing Landlords from letting properties that fall below the necessary standard.

Legal compulsion on individual owners

Almost all owners will ultimately see themselves as potential sellers.  For the few who will still not cooperate there needs to be a means of burdening their titles and/or taking speedy court action to give force to the will of the majority.

Promote responsible property ownership

The disastrous involvement of City of Edinburgh Council in common repairs to private property has exposed an underlying flaw in the whole idea of “enforcement” as a viable approach to the problem.  The Edinburgh District Council Order Confirmation Act 1991, which confers powers that are unique in Scotland to Edinburgh, quite correctly limited the Council’s power to repairs only.

The restriction on the scope of work to repairs only created many anomalies to which some lip service was paid, but in general were routinely ignored.  Does it make sense to erect expensive scaffolding, as modern Health and Safety requirements demand, to replace, perhaps, a slate or two if that is all that is immediately required when it can be argued that, over the longer term, reslating the relevant roof slope would be better value for money?  Adopting the latter course opens the Council to legal challenge.  Hitherto there was, perhaps, some tacit acceptance of these anomalies and matters proceeded in an atmosphere of trust.  Any future implementation of a scheme of enforcement would require to adhere closely to the letter of the law and the outcome would often be far from sensible or good value for money.

With the proposed revised Home Report arrangements in place there would be an incentive for cooperation between owners which would reduce the currently perceived need for local authority involvement.

Recommendations

Scottish Government to revise the Home Report to:

1. Clarify the scope of reporting on roofs and other common parts of tenemental property.
2. Provide in Home Reports on tenemental property information (to the extent that it is available) on the condition of the Common Parts including what maintenance or repairs are required, at what cost and when.
3. Include in Home Reports a tenement specific section in the Property Questionnaire covering maintenance management arrangements (in addition to Section 11).
4. Enable the provision of a rating (similar to the EPC rating) of the quality of the maintenance management arrangements in place for the tenement.

and in addition to:

1. Publish best practice guidance on Quinquennial Reports.
2. Require owners of property within Common Property to make mutually available their current contact details or those of their appointed agent and for all owners to be automatically notified of changes in ownership.
3. Review and refine the arrangements to ensure a clear apportionment of liability on change of ownership.
4. Simplify the process of legal compulsion on, and cost recovery from, uncooperative owners by the majority.

David Gibbon is a Founder and Director at GLM, a mixed practice of building surveyors, architects and project managers and he is accredited by RICS in Conservation.  He specialises in the care and conservation of historic buildings. He is an outspoken advocate of Statutory Notice reform in Edinburgh and of more general reform of the arrangements for common repairs in Scotland as a whole.  If you would like to learn more about common repairs policy in Scotland, please email David at david.gibbon@weareglm.com or follow him on Twitter for common repairs updates on @Mrdeegee