The Tenement Health Check – Time for New Policy?

John Gilbert reflects on Royal Incorporation of Chartered Surveyors’ (RICS) report Tenement Health Check Policy which aims to raise the issue of lack of maintenance in Scotland’s tenemental housing stock.

Building maintenance is the key to sustaining and future-proofing the fabric of buildings. Nowhere is this more problematical than in the case of buildings in common ownership.

Only well maintained buildings will provide adequate living conditions now and for generations to come. Neglected buildings cause social problems and end up being condemned. This will exacerbate a housing supply problem that is already critical.

Poor maintenance of buildings in common ownership is prevalent throughout Scotland, irrespective of location and whether or not third party management arrangements are in place. This points to systemic problems that require government action. RICS is proposing, as part of the solution to this, measures to encourage, and if necessary compel, common owners to have condition surveys undertaken every five years.

The Scottish Housing Condition Survey 2015 (published in 2016) confirms the increasing disrepair of our older pre-1919 tenement properties. In Scotland, 24% of all domestic housing is formed from 579,000 tenement properties of which 218,000 are older pre-1919 tenements. The survey shows that 68% of the pre-1919 properties are in a state of critical disrepair.

The survey shows that dwellings with “critical, urgent and extensive disrepair” increased from 5% in 2014 to 8% in 2015.

This decline in maintenance of our commonly owned properties may be exacerbated by a lack of legal bite in ensuring property owners manage and maintain their homes. In the past, Edinburgh’s stock has had the fallback of compulsory repair orders issued by the City of Edinburgh Council. With the failure of the Edinburgh system and a lack of funding, local authorities have drawn back from issuing repair notices for all but the most urgent structural cases.

The extensive use of repair grant funding in past years may have made some owners expect that all common repair needs to be grant aided.

To address the problem, the RICS (and indeed many others) believe that there needs to be a legal requirement for a Tenement Health Check. This check would be in two parts:

  1. a building condition survey: this would provide a detailed condition survey of the common parts of the building: stairwell, stair lighting, roof and chimneys, stonework, close windows and skylights, doorways. The report would highlight those areas that required attention and provide approximate costs.
  2. Gold standard report: the survey would check and rate on those measures that achieve a ‘gold standard’ and rating the standard A to G. This could be included in the home report:
  • current condition of shared parts
  • if a residents’ committee is set up
  • if the residents’ committee have a common banking account, a sinking fund and common insurance policy
  • a coherent maintenance management programme
  • evidence of dealing with items in the tenement health check

Costs and funding
A full building condition survey costs in the region of £800-£1200 (excluding VAT). RICS recommends that as an incentive to carrying out the tenement health check process, residents’ associations would be eligible to claw back VAT on any common repair work that is undertaken which addresses the needs of the property. This would encourage people to use VAT registered companies and should improve the quality of work undertaken. It should also encourage apprenticeships to develop.

However there is evidence that even when owners receive condition survey reports on their tenements (for free), they rarely act on the reports. Unless there is a factor or strong residents’ association, people are unwilling to invest time in organising the work and ensuring all owners pay up (as inevitably, some won’t).

About 200,000 flats in Scotland are not managed by a factor and few are fully self-factored. Tenement abandonment is becoming more common, but help to buy and cheaper flats often end up in the hands of landlords or absent owners who care little for common maintenance. Air B &B is becoming an increasing problem in places like Edinburgh as flats are let out all year round to tourists, leading to a decline in community presence and involvement in the very areas that tourists visit.

It is clear that the present Law of the Tenement has failed to address the needs of maintaining property in common ownership.

It seems strange that when you buy a flat in a tenement, you are also buying, and investing in, a share of the common fabric. Yet you may not know easily, who your other shareholders are.

So there are a number of actions that need to be incorporated into the Law of Tenement ownership ( or shared ownership):

  • the need to have all owners registered so that fellow owners can contact other owners who share the property. This can be done by requiring owners to set up a residents’ association
  • the Association must take out a common insurance policy on the complete building
  • every owner should have to pay a monthly sum into a sinking fund set up by the owners; association. The sinking fund should ensure there will always be sufficient funds to pay for the common insurance as well as to commission a tenement health check at least every five years.

Any home report should refer to the tenement health check so that owners are aware of how well the common parts have been maintained and also the likely future maintenance costs on the property.

Similar schemes exist in European countries but Scotland has been lax in forming laws that will prevent deterioration of property, which is after all, a huge asset to the country. Having a requirement for a detailed inspection and report (at least every five years), will not only show owners what work is essential, it will raise issues of health and safety.

There is still a significant level of ignorance over who is responsible for what and what can be done to resolve common repair problems. The website aims to help owners find information on typical problems they will encounter when repairing and managing maintenance of a tenement and other shared housing types. However much more needs to be done to support people who own a flat in a tenement. It makes sense to change the ‘help to buy’ policy for homeowners into more of a ‘hope to maintain’ otherwise we will need to replace our housing stock at a much greater rate.