The management of leasehold developments is a hugely competitive market. In what is an unregulated market, many leaseholders take their chances with one or another managing agent who can talk the talk. But how many of them can actually walk the walk? And how do the attitudes and behaviour of managing agents in the industry reflect on reputations and work ethics?
Picture the scenario – you have decided you need a new managing agent and you want good service. So, you begin your search to find out who will serve your development the best. Perhaps you want the biggest managing agent as you feel peace of mind knowing that so many other leaseholders use them. Or maybe you want a local managing agent, one who knows your area and perhaps your building already. Alternatively, you might want the agent who offers the cheapest rate, believing you are getting value for money.
You may want a recommended managing agent via an industry body (RICS or ARMA), or perhaps you had an introductory letter through your door. Some leaseholders use Google and others may have seen an advert on Facebook. Whichever way you find them, managing agents want your business and they will do what they can to get it. Once they get it, they of course, want to protect it. But surely the best form of protecting their business, is by giving the best service and keeping their promises? It seems that many agents unfortunately don’t do this. Perhaps these competitors should turn their focus onto serving their customers in better ways. It is sadly, indicative of a wider problem in the industry. Concordia’s ethical stance is a threat to some, but we don’t apologise for that, the leaseholder is paramount to us and we will continue to try to affect change for them.
We recently attended the Institute of Residential Property Management’s Annual Conference in London, where it was clear that the industry has a certain culture. Comments from speakers such as “self-regulation won’t work” (Lord Best), “culture change is needed to focus on customer service and treating the leaseholder as the end user” (Mark Prisk MP), and “the number of complaints is rising” (Katrine Sporle), all indicate that something has been very wrong in the sector for some time. Many managing agents see the leaseholder as a commodity – a cash-cow that they can milk dry of all their hard-earned money. All the hidden charges add up – paying by standing order (up to £50.00 a year with some managing agents!), paying for permission to let (even when it is not the managing agents permission to give…), extortionate debt collection fees charged out as soon as possible (even if you paid, but forgot your exact reference), excessive insurance commissions (sometimes leaseholders will be paying up to 60%! Imagine that – of the £1,000 insurance charge per year, £600.00 of it goes to the managing agent). All these added extras, and more, go into the managing agent’s pocket. This is not making a fair living – it’s extortion in our opinion and it’s not morally right. It’s no wonder that managing agents don’t want to lose any clients and that they are fiercely competitive!
So, when a new agent, such as Concordia Residential, comes onto the market with their competitive edge of doing business ethically and without all the hidden extras, it is understandable that some managing agents may become twitchy and uncomfortable. Professional courtesy and healthy competition would radically change the culture of our industry for the better. Everyone in the leasehold management sector caters to different desires of the end user and surely, we should all be respectful and courteous of each other, supporting the different ways we can all help our leaseholders.
Concordia Residential welcome with open arms the upcoming mandatory regulation in the industry to ensure that malpractice is filtered out. As Lord Best stated, ‘self-regulation doesn’t work’. The culture of the industry needs to change in order to benefit the end user – the leaseholders and tenants. And this is a huge part of Concordia’s mission and reason for existence.