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Buying and selling a park home: a brief guide

noticeboard legal advice Visit: www.parkhomemagazine.co.uk PARK HOME & HOLIDAY CARAVAN MAGAZINE DECEMBER 2014 73 Left John Clement, a partner and head of Turbervilles’ Litigation and Dispute responsibility to ensure that the transaction is completed properly. If any mistakes are made this could lead to the assignment of the agreement being unlawful, and to costly disputes between the parties. What is different about buying and selling a park home? It is important to remember that whenever someone sells their park home on a residential park there are actually two transactions which happen at the same time – the sale of the park home itself, and the transfer (‘assignment’) of the seller’s Mobile Homes Act occupation agreement to the buyer. I bought my park before 26 May 2013, and now want to sell it. Is there a procedure that I must follow? Yes. As your agreement commenced before 26 May 2013, and if it has not been assigned or transferred since 26 May 2013, it is defined as an ‘Existing Agreement’ and the following procedure must be used: Step 1: Once a price for the home has been agreed between the seller and buyer, the seller must provide the buyer with a form called a ‘Schedule 1 - Buyer’s Information Form’, together with copies of certain key documents. The form and other documents must be supplied to the buyer at least 28 days before the date when completion of the sale of the home is to take place, unless the buyer has agreed to a shorter period. The key documents that must be sent include: • A copy of the seller’s Mobile Homes Act agreement/written statement; • A copy of the current park rules; • Written details of any charges payable in respect of electricity, gas, water, sewerage or other services supplied to the park home, including when these charges are payable and when they are next due for review; • Written details of any other charges relating to the home or the park, including any charges for the use of a garage, parking space or outbuilding; • A copy of any current warranty for the home; • A copy of any structural survey of the home, the base or the pitch which the seller has had carried out in the previous 12 months. On 26 May 2013 the Government introduced a new procedure that must be followed whenever a used residential park home is bought or sold on a site in England. One of the main reasons for this change was to take the process out of the control of the site owner, as there were concerns that some park owners had been unfairly trying to prevent home owners from selling their homes. The new procedure is intended to give occupiers greater protection. One effect of this is that both buyers and sellers of park homes now have much more We look at the recent changes to the procedures for buying and selling a park home. John Clement, a partner and head of Turbervilles’ Litigation and Dispute Resolution team, and the Leasehold Advisory Service’s Ibraheem Dulmeer examine the main issues Buying and selling a park home: a brief guideWe look at the recent changes to the procedures for buying and selling a park home. John Clement, a partner and head of Turbervilles’ Litigation and Dispute Resolution team, and the Leasehold Advisory Service’s Ibraheem Dulmeer examine the main issues

On 26 May 2013 the Government introduced a new procedure that must be followed whenever a used residential park home is bought or sold on a site in England. One of the main reasons for this change was to take the process out of the control of the site owner, as there were concerns that some park owners had been unfairly trying to prevent home owners from selling their homes. The new procedure is intended to give occupiers greater protection.

One effect of this is that both buyers and sellers of park homes now have much more responsibility to ensure that the transaction is completed properly. If any mistakes are made this could lead to the assignment of the agreement being unlawful, and to costly disputes between the parties.

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The site rule making process

The site rule making processNew laws have introduced a procedure for making, varying and deleting park rules. Residential park site owners will be required to consult with residents if they wish to retain existing rules or make new park home site rules, as Chris Humphreys and Ibraheem Dulmeer, of the Leasehold Advisory Service (LEASE) explains

There is no legal obligation to introduce rules about the running of a site. But if a park owner chooses to do so, a strict procedure must be followed. The procedure can be found in the Mobile Homes (Site Rules) (England) Regulations 2014. Ideally, the process should be completed as soon as possible as all existing rules will only stay in force until 3 February 2015 unless action is taken before then.

However, all existing rules which have been banned will cease to have effect immediately.  For example any rule which prevents the park home owner from selling or gifting the mobile home to anyone other than the site owner.

How does this process work?
The first step is for the site owner to serve a document called a Proposal Notice on all park home owners and any Qualifying Residents’ Association (the consultee).  The Proposal Notice must clearly set out the proposals being made by the site owner and must state the reasons for making these proposals. 

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Qualifying Residents’ Associations: practice, procedure and formation

october legalIn 2006 the law relating to residential parks changed and it became possible to establish a Qualifying Residents’ Association. Nick Dyson, partner at Blacks Solicitors LLP, and Ibraheem Dulmeer, legal advisor at The Leasehold Advisory Service (LEASE), address some common QRA-related questions

So what is a Qualifying Residents’ Association (QRA)?
It’s best described as a group of residents who work together to represent the interests of residents on a park. A QRA can operate in a number of ways including consulting with the park owner about issues which are affecting the residents on the park and arranging social activities.

How do you form a QRA?
Practically speaking it would be best to make enquiries with fellow residents to see if there is any interest in establishing a QRA. Perhaps arrange a meeting and notify all home owners of the date and time so a discussion can be held about making the necessary arrangements to form a QRA.

It will then be important to see if you can meet the following conditions which are required to establish a QRA:

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Home help

september legalWe speak to Anthony Essien, CEO of the Leasehold Advisory Service (LEASE), to see how this organisation now offers help and advice to park home owners

In some ways, owning a park home is a bit like owning a leasehold flat. In both cases you don’t own the land in which your home is situated, usually having to pay some type of ground rent to either the freeholder of the building (in the case of a flat) or as pitch fees to the park owner (in the case of a park home). The Leasehold Advisory Service (LEASE) is a non-departmental public body that is funded by the Government to provide free legal advice to leaseholders, landlords, professional advisors, managers and others. The advice covers the law affecting residential leasehold in England and Wales.

Recognising that park home tenure is very similar to leasehold tenure, LEASE now also offers advice to park home owners, site managers and others. To get help, you can either write to LEASE, send an email, call its helpline, or attend its London offices in person. The organisation also runs a website for park home owners with advice guides that can be downloaded, plus the latest news relating to park home ownership.

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Commission commotion

Commission commotionMembers of the Park Home Owners’ Justice Campaign held a rally at Westminster on 2 July and presented a petition at No. 10 Downing Street calling for a review of the commission charge on park home sales

The Mobile Homes Act 2013 addressed most of the concerns that residents had expressed about their relationship with their park owners. However, there was one matter that did not receive the Government’s attention in that legislation – the payment of ‘up to 10 per cent’ of the sale price of a park home to the site owner when a resident sells his/her home.

The Park Home Owners’ Justice Campaign, headed up by Sonia McColl OBE felt this statement needed to be challenged. The Justice Campaign argues that when the last economic survey of the park homes industry was undertaken, park operators did not show proper audited accounts to prove their earnings. Also, it queries how the commission payments can be vital to the survival of park-owning businesses when such income is so random. For example, it could happen that there are no sales at all on a park in any one year (and, hence, no commission payments to the park owner) but in other years there may be several.

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Minister sees ‘no need to review commission’

Minister sees ‘no need to review commission’At an adjournment debate on park homes, called by Annette Brooke MP, discussions ranged over many subjects but especially pitch fees and commission. The Minister’s response was that there was no need to review commission at this time

Park homes were the subject of an adjournment debate in Westminster Hall on 13 May, called by Annette Brooke (MP for Mid Dorset and North Poole).

In welcoming the Mobile Homes Act 2013, which she agreed went a long way towards rebalancing the rights of park home owners and park owners, she commented that, as certain parts are being implemented at different times, it was difficult to judge its effectiveness. She questioned whether the DCLG had effectively communicated the new rights that residents now enjoy to them and in particular how the new legislation on sale blocking was being monitored and enforced.

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