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Persimmon Homes Publish Independent Review

Persimmon Homes has published its “wide-ranging independent review” that began back in April and apparently took over eight months to discover a “lack of a group build policy increases the risk of defects in its houses.” Who knew?

This is the basket case, housebuilding pantomime villain; Persimmon Homes with “no agreed procedures to supervise or inspect its employees or sub-contractors’ work and that staff were only given limited training.

The independent review report was carried out by QC Stephanie Barwise who begins with a legal a disclaimer of liability – “Findings made on an information only and non-reliance basis – no liability or duty is accepted” and recommends that Persimmon Homes “should take sufficient time to formulate and embed a ‘Persimmon Way’ of building”. In the meantime its shares plunged 7.32% on the week. You can read their “Difficult truths” here

So over 8 months since Persimmon realised they have a quality issue that needs addressing, how long will it be before the board take action, start sacking indifferent staff and turn this house building hulk around? If they didn’t know before, or chose to ignore (year after year) what their own customers had been saying, they certainly know now, what is wrong and what needs to be done. But I believe there will be no discernible improvement in either quality or service in the next 12 months because any permanent change of corporate culture could take as long as 20 years and only then, if there is a will and there is a way.

The damning review conclusions:Missing cavity fire barriers Persimmon Homes

Persimmon homes flag“Persimmon has traditionally been more a land assembler and house-seller rather than a housebuilder”

“Persimmon Homes has relied on third party warranty providers for inspection of the key build stages. It is unrealistic to regard the warranty providers as being able to inspect all work stages or even all properties; they do not.”

“Persimmon’s pledge that it inspects the work at all stages of the build process is not currently met.”

“A push for sales masked severe problems in build quality and a lax corporate culture which allowed those problems to continue.”

“Persimmon has a nationwide problem of missing and/or incorrectly installed cavity barriers in its timber frame properties, first discovered in October 2018.”

“Pre-completion procedure may have contributed to a culture of non-observance of certain stages in the process, or a mere box ticking exercise, stemming from a belief that any single stage is not important, as another check or inspection will follow later.”

HBF Star Rating “does not accurately reflect build quality”

“The post-completion procedure is focussed on the obtaining of stars via the HBF Survey results from the answer to a single question, “Would you recommend the builder to a friend”, asked eight weeks after legal completion. The Home Builders Federation (HBF) star rating is a measure of quality as perceived by the customer shortly after completion, rather than a measure of the TRUE QUALITY and safety of the build.”

“Therefore, if Persimmon Homes does want to be, and be known as, a builder of quality homes, its aspirations cannot be realised simply by achieving a four or five star HBF rating”

HBF star rating no guide to qualityNot exactly how the HBF spin it in their survey reports each year. But now we have an independent report that categorically states that the HBF 8-week survey results and star rating “does not accurately reflect build quality” and is therefore, quite frankly, pointless and meaningless.

“we consider that the HBF Recommendation Score is not necessarily the most appropriate measure, since it does not accurately reflect build quality, albeit it is an indicator of customer service”

But that hasn’t stopped the HBF spinning the survey responses as evidence of “improving quality” especially as the survey sole purpose is to “provide data to rebut negativity.”

“The review clearly shows that the surest route to improved customer satisfaction is through the delivery of consistent build quality and service”

Not £250 John Lewis vouchers in return for a “Yes” to Q1 in the HBF 8-week survey?

In response to the independent review report findings The HBF claim:

“The star rating system is an accepted barometer of how homebuilding companies are performing and has led to a step change in how the industry provides customer service. It is not intended to be a technical check on the house, there are a range of other checks carried out on a new-build home, by the builder and external bodies, to ensure the home is built to the requisite building standards.”

Build stage inspections

Persimmon Homes independent review report states:

“In late October 2019 Persimmon set up a working group with a view to determining inter alia the work stages to be inspected. At the time of drafting this Report, we understand that this process is ongoing and that Persimmon has not yet identified the stages it intends to inspect, nor the manner in which it intends to perform those inspections.”

You really do have to wonder why, giving this damning indictment of a lack of understanding of the basic housebuilding process, “not yet identified the stages to inspect” by presumably board directors, this report was ever made public!

Missing Cavity Fire Barriers

Persimmon has a nationwide problem of missing and/or incorrectly installed cavity barriers in its timber frame properties, first discovered in October 2018.

“The problem Persimmon has encountered with missing/improperly fitted cavity barriers is a systemic nationwide problem, which is a manifestation of poor culture coupled with the lack of a Group build process”

Half a job?   Persimmon Homes independent review report states:

“inspections to date have been limited to the eaves, and have not checked for cavity barriers which should be present around doors and windows/in party walls. It recently came to light during this Review that on one site, Persimmon operatives and/or subcontractors retained by Persimmon to remedy any issues with cavity barriers had, on two separate visits to one property, claimed that all missing cavity barriers had been retro-fitted when in fact they had not been.”

So a defect, with potentially fatal consequences, on a national scale is found to be not properly rectified even at a second or third attempt!

“We also recommend that Persimmon Homes carries out spot checks on the site where it was twice incorrectly asserted by different Persimmon operatives and/or subcontractors that the cavity barriers had been retro-fitted”, and indeed more generally”

“It is also a clear demonstration of the disconnect between the award of stars via HBF Survey and true (as opposed to perceived) build quality, since one of Persimmon’s 5 star businesses has the highest incidence of missing or incorrectly installed cavity barriers.”

For all that is in Persimmon’s Independent Review, the fact remains that a fish rots from the head and if left long enough everyone notices the smell! The first thing Persimmon need to do is actually recognise they WANT to change.

The Persimmon independent review report shows “a push for sales masked severe problems in build quality and a lax corporate culture which allowed those problems to continue.” With many unhappy homeowners seeing Persimmon as “crooks, cowboys and con-artists,”

Executive pay and bonuses

Jeff FairburnThe review reports states “The amounts in question were widely perceived as excessive.” Disgraced ex CEO, Jeff Fairburn who received a record £75million bonus windfall, has thus far, according to The Daily Mail, kept his miserly mitts firmly clamped on his ill-gotten bonus millions. This despite having previously pledged in February 2018 to donate a “substantial proportion” to charity via a private charitable trust following public outrage at his then £130million bonus windfall, yet has failed to do so. This was the man who has presided in a decline in the number of NHBC awards for quality won by Persimmon’s 380 site managers, from 21 in 2012 to just two in 2018. Update: In January 2020, it was revealed that Fairburn (53) has resurfaced and bought his way into Berkeley Deveer, a small regional Yorkshire housebuilder having been appointed chief executive after buying a 50% stake in the business.

We should also not forget that current CEO David Jenkinson received £45.5million under the Persimmon long term incentive plan (LTIP)

“The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those that have too little.” …Franklin D Roosevelt

But when will Persimmon Homes learn?
You couldn’t make it up, just as the review report is published, Persimmon is in the press again having built a brand new 110-home estate precariously close to a collapsing riverbank on the site of an old colliery! It is as if stupidity is being regarded as a virtue!

“Our houses are set back from the bank and are in no danger of moving or being damaged. We have no concerns about our nearest property and no remedial work is required.”   So says Persimmon spokesperson but is it reassuring?

It has to be said though, just how many other plc housebuilders would wish the UK new home buying public to know the ‘warts and all’ truth?  Have Persimmon been foolish?  Will this be its “Ratner” moment?

If Persimmon is genuine in its regret and remorse, it should be paying out thousands to compensate their buyers for their sub-standard, defective, poor quality new homes and giving all those that bought leasehold houses their freehold, as they have undertaken to do on a Cardiff development, without any sneaky management charges, known as  “Fleecehold.”

A Ministry of Housing spokesperson told Housing Today that in future, house builders which did not meet the required standards of safety and quality might not be given access to Help to Buy cash.  If ever there was an indication of the FAILURE of this government, MHCLG and its Minister Robert Jenrick, to tackle shoddy, defective and dangerous new homes this is it! “In future” “Might not” – why not start right now with Persimmon Homes and withdraw their access to Help to Buy?

Persimmon Homes new chairman Roger Devlin said:

Roger Devlin“This review – and the seriousness that we attach to its detailed findings – is an important moment for Persimmon as we continue to build a different business with an increased focus on our customers and wider stakeholders – becoming a business that prioritises purpose as well as profit.”

The detail is in the Devlin!  But only time will tell if he is sincere. Reading this  snapshot of the company’s tarnished history, I believe it is beyond redemption. It should be noted that Persimmon Homes also have history for making similar noises on improving quality and service. In their Annual Report for 2015 published on 22 February 2016, CEO Jeff Fairburn stated:

The Group’s priority is to serve our customers well by providing good quality new homes and great service. All of our team are [sic] responsible for delivering high levels of customer satisfaction….Our sales teams across the business are trained to provide excellent levels of service to our customers.”

“During 2015 we invested substantial resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating. We have introduced dedicated customer liaison managers on our larger sites, improved communication processes with our customers, introduced new processes to strengthen our build programmes and provided additional resources in our customer care teams. These initiatives are showing some early signs of improvement in our customer satisfaction ratings and we will continue to pursue this agenda to secure further progress this year.”

Twelve months later in the Annual Report 2016, the company again promised to improve:

“During 2016 we have continued to invest additional resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating. This is yielding further improvement in performance with the majority of the Group’s operating businesses showing progress. Prior to customers moving into their new home we have improved our communication processes with them to provide greater understanding of the progress we are making in constructing their new home. We have strengthened our build management processes to facilitate delivery to expected timeframes. Additional support is being provided through reinvigorated processes to demonstrate the features of the new home to customers, assistance with identifying any small remaining issues on moving in day and providing improved systems and processes for our customer care teams to support the prompt rectification of any outstanding matters. Customer care performance is reflected in relevant employees’ remuneration to support a closer alignment to the Group’s objectives. Whilst these initiatives are delivering tangible improvements in our customer satisfaction ratings we remain determined to deliver further advancement this year.”

Regardless of whether Persimmon actually do really intend to change and do what they say they will this time; the government should take note of this report and instigate a wider investigation, in the form of a public inquiry of the housebuilding industry and ignore attempts at positive spin from the HBF.  It is clear Persimmon have failed all ends up, but I am in no doubt it is not unique. If, as seems likely, the government is intent on continuing with taxpayer subsidies to plc housebuilders via Help to Buy or any replacement, it must make these conditional on ongoing, independently validated and monitored build quality.

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Persimmon Homes Announce Independent Review

Persimmon Homes announces an “independent review of workmanship, culture and customer care”

Following on from Persimmons announcement last month of its 1.5% homebuyer retention scheme, made in response to growing criticism about the quality of its homes, Britain’s worst housebuilder – rated only 3 stars by its own customers five years in a row, is now launching an independent review of its customer care, culture and workmanship as part of an attempt to move on from the executive pay scandal and complaints about its defective homes.The wide-ranging, independent review will be led by Stephanie Barwise QC of Atkin Chambers,  and will look into Persimmons customer care approach, systems and culture, quality assurance processes, and the speed and consistency of its response to issues. The company intends to publish the findings towards the end of 2019. It seems strange that Persimmon has chosen to employ a QC to conduct its independent review. However with her “expertise lies in civil engineering and construction disputes” and “considerable experience in alternative dispute resolution methods including adjudication and mediation.” perhaps not.Independent review of Persimmon homesSince the introduction of Help to Buy in 2013, Persimmons share price has more than doubled. Persimmon relies heavily on the scheme with almost half of its buyers having used Help to Buy last year.

In a company statement Persimmon said:

“Persimmon has been focused on rapid change and improvement of its customer care culture and operations, and on eliminating cases of poor workmanship. To assess the effectiveness of the new measures and processes and to determine whether they appropriately position the business for the future, Persimmon’s board … has commissioned an independent review.”

This Persimmon “independent review of its culture, workmanship and customer care” looks to me little more than a plastic, public relations stunt designed to obtain some credibility with third parties and a government that has already indicated it is mindful to suspend Persimmons access to Help to Buy. Even the death of a 4-year old child caused by a defect in a Persimmon home didn’t force change, but as soon as James Brokenshire threatens to take away access to the Help to Buy gravy train, Persimmon make two press release announcements in as many weeks!

Persimmons culture is one of unparalleled boardroom greed. Driven by a hunger for increasing profits year on year, whatever the cost, with total indifference to its reputation, build quality and its customers.

Year after year Persimmon has said in their annual reports:

In 2016, Jeff Fairburn said:

“The Group’s priority is to serve our customers well by providing good quality new homes and great service. During 2015 we invested substantial resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating.”

In 2017, it was repeated:

“During 2016 we have continued to invest additional resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating.

In 2018:

“Delivering good quality new homes with a high standard of customer service is a priority for the Group. Although we have increased our build numbers significantly in recent years, our quality control procedures and increased use of standard house types have helped to maintain our build quality.”

This year Persimmon said:

“Delivering a good quality product for our customers and providing high levels of customer service throughout the home buying process is a top priority for the business.” and more recently: “we hear the message that we need to continue to raise our game in customer care.”

Do Persimmon Homes really need an in-depth, independent review of the way it has been operating to find out where it could, if it chose to do so, improve? It is inconceivable that those on the board haven’t known for many years what they are doing, building very poor quality defective new homes and what they are most definitely not doing, putting their customer first. Why do Persimmon routinely refuse to allow buyers’ professional snagging inspectors access before legal completion?  “Company policy” they tell their customers”

Persimmon could ask their employees. Here is what a Contracts manager no less said about the company!

Ask the thousands of unhappy customers


And Persimmon need an independent review?
They could ask their buyers 13,476 members on the Facebook Group Persimmon Unhappy Customers’  There are many stories like this online, going back many years. Persimmon even made a counter claim against one of their buyers for the cost of repairs to his home! Persimmon appear to go out of their way to be confrontational and intransigent to any customers who take issue with the builder. The phrase “the Customer is always right” isn’t even on their radar if this story from the North East Evening Chronicle is anything to go by. Persimmon   failed to fix defects for nine months in this house.

Why don’t they also publish their 9-month NHBC customer survey results for the last 5 years?  Plenty in there to show those head burying, bean-counters on the board that are now, apparently, so keen to discover where it all is going wrong!

So do you really need a root and branch “independent review” of your business practices at Persimmon. It’s obvious what is wrong when you do things like this?

“They chop down trees, build shoddy homes and go to the lavatory. On Wednesdays they sell dodgy leaseholds and have buttered scones for tea!”

Cutting down around 260 trees and more than 80 metres of hedgerow from the eastern boundary of their Millennium Farm development is hardly going to improve Persimmons public image. North East Lincolnshire Council believe Persimmon have “breached planning regulations”, and has launched an investigation to discover whether they have been working outside their agreed terms.

Persimmon built homes with missing cavity fire barriers. In Cornwall  In Devon with their development in Cranbrook was the first development site identified. In fact this could be a widespread systemic omission/defect. Perhaps Persimmon owe it to their customers to be conducting an independent review into why and how hundreds, maybe thousands, of their new homes can be built with a potentially fatal defect.

When it is discovered by buyers they first deny it then say it is limited to one site. Eventually forced to check many developments as the issue becomes known to BBC Watchdog.   The difference between Persimmons financial performance and customer satisfaction is so stark, this, surely, is an area where the government should take an interest. James BrokenshireYet the most we have heard are comments from James Brokenshire, the housing secretary, that he will be “considering carefully” how developers that are part of an updated Help to Buy scheme from 2021 should “meet the standards and quality that customers expect and deserve”. We’ve heard it all before James – nothing has changed! Be careful, as voters will remember you as ‘James Brokenpromises’

Persimmons latest headline grabbing homebuyer retention scheme is strangled by restriction and limited only to the defects buyers spot the day they get their keys. How daft do Persimmon think we all are?

These smokescreen PR gestures will not change Persimmon. In fact, I firmly believe that once the company has fooled government and secured approval to continue with the next extension of Help to Buy, the homebuyer retention scheme will be quietly ended and the independent review report will be ignored, gathering dust on a boardroom shelf. If Persimmon did really want to change, it needs to do much more and even then, it will take a generation to repair its terrible reputation as Britain’s worst housebuilder.

UPDATE: 17 December 2019 The waiting is over as Persimmon Homes publish the findings of their independent review.  They admit there are some “difficult truths to confront” and they intend to take time and formulate a “Persimmon Way” of building. Only time will tell if this shambolic company is really serious and genuine in its intention of improving its poor quality and service to buyers, or whether this is just another smokescreen PR exercise to divert attention from the media spotlight.

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Persimmon Launches Homebuyer Retention Policy

Persimmon announce 1.5% homebuyer retention policy

Persimmon homes - giving greed a bad nameIn a blaze of positive publicity, under headlines such as Persimmon homebuyers can withhold money until faults fixed (well not exactly); the housebuilder everyone loves to hate, has launched what is claimed will be a ground breaking initiative and a first for the industry, in response to overwhelming criticism about the quality of its homes, the obscene corporate greed-fest of executive bonuses and its part in the leasehold scandal,  Persimmon homebuyer retention “allowing buyers to withhold an average of £3.600 per home until all faults are fixed”

Nils Pratley in The Guardian suggests the homebuyer retetention could have been called the ‘Jeff Fairburn memorial clause’ – an eye-catching gesture designed to combat Persimmon’s reputation for corporate greed, as embodied by Fairburn’s infamous £75m bonus.”

A few weeks ago Nils said, in another well-written article: “It’s nice that the housebuilder wants to address its substandard scores for customer service, but shouldn’t this thought have occurred when the executives, Jenkinson included, were racking up their millions?” 

Not forgetting, this is a company that has also now admitted it lobbied government in 2015 to abandon the zero carbon policy for new homes.

In the Financial Times, Persimmon’s recently-appointed CEO Dave Jenkinson said:

“Persimmon is listening hard to all of its stakeholders and we hear the message that we need to continue to raise our game in customer care.

CEO Dave Jenkinson announces Persimmon homebuyer retention

“The initiatives we have already announced, including the action taken in the new year to deliver greater accuracy of anticipated moving in dates by adopting a more targeted approach to the phasing of sales on specific sites and the improvements and investments that we have made in our customer care team, operations and technology over the last few months are beginning to take effect.

“We are now accelerating the pace of change through the introduction of a contracted retention, which will give homebuyers far greater satisfaction at the completion of the purchase.  

“Moving into a new home should be a positive experience enhanced by all the benefits of a new build that is designed for modern living.  We are determined that the experience is not overshadowed by teething problems and providing a homebuyer’s retention is an important step towards achieving this.

Chairman Roger Devlin, said:
“This is a first among the UK’s large housebuilders and I hope will lead the way in change across the sector. This move, and the urgency with which we will introduce it, is a clear and unambiguous signal of cultural and operational change at Persimmon putting customer care at the very centre of the business.”

Other “improvements” include offering maintenance appointments at weekends and out-of-hours opening of customer care departments.

In the big announcement, Persimmon said it “would implement the homebuyer’s retention, by writing into its standard sale contract that 1.5% of the property value (£3,600 on average) could be withheld by the buyer’s solicitor until any faults identified at the point of key release are resolved
Update: During the time it took Channel 4 Dispatches to make ‘Britain’s New Build Scandal’ June-July 2019, featuring Persimmon, the time limit  buyers had to report faults was extended to 7 days.

The homebuyer retention policy, announced in haste, won’t be fully in place until the end of June 2019 – so much for its claim “we are now accelerating the pace of change”! But why wait until June? It’s hardly Brexit! Well, the end of June is Persimmon financial half-year, so homes could be rushed to get them included for the half-year. In addition, Persimmon will need to start building better, much better and all homes completed after the end of June, will not yet be started.

But quite frankly, this could easily be implemented at the beginning of April, fittingly perhaps on April Fool’s day as in my opinion, buyers and the government would be fools if they believe this small sticking plaster on a disgraceful housebuilder that gives greed a bad name, will make any noticeable positive difference for buyers.

Unlike the Barratt 5-year warranty, which despite its exclusions, was a corporate statement of quality: “our product is so good we are so confident we can afford to give our buyers a longer warranty”  The Persimmon homebuyer retention announcement shouts: “our product is so bad, we have decided to allow our customers to withhold part of their payment until we have sorted out defects”

This scheme is also  unlikely to cost Persimmon anything, with any costs being borne by the sub-contract companies it employs.  Retentions are deducted on all sub-contractor payments. Half is usually returned 6 months after the buyer moves in, with the balance normally after two years. The percentage retention is negotiated at the time the contract is drawn up, often used by housebuilders as a bargaining tool to force their sub-contractors to discount their rates or accept payment terms “monthly valuation on account.” Most sub-contractors tend to view any returned retention as a bonus, as it is priced into their rates.

Persimmon homebuyer retention – so what is not to like?
This is not as it first appears. For a start, this only applies to “faults” (I prefer the term defects) that excited and distracted buyers note and report at the time they are first given the keys. Why not make it for ALL DEFECTS notified to Persimmon in the first 6 or 9 months? It should not be limited to just those small, quickly dealt with, cosmetic “faults” which may, or more likely, may not be spotted by buyers on the day they first get the keys to their new home.  This will certainly not be of any help to buyers that later discover they have weak mortar, cracking render, issues with their floors or serious fire safety issues like this 

If Persimmon really are “determined that the experience is not overshadowed by teething problems” why does the company routinely refuse to allow their buyers and/or their professional snagging inspectors access to their homes to check the property before legal completion?

Persimmon "Teething" problem?The homebuyer retention monies are also to be held by the buyer’s solicitor. In most cases this is highly likely to be one that Persimmon has suggested, recommended, or in some cases, even bribed or required the buyer to use. A recent government inquiry found conveyancing solicitors are too close the house builder. There is a clear conflict of interest. The report says: “buyers’ interests ‘cannot be served where they are coerced into using developer-recommended conveyancing solicitors, who rely on repeat business from developers and may not be inclined to put their client’s interest first.”
This is also against the Law – The Consumer Protection from Unfair Trading Regulations 2008, In addition, it also breaches requirement 2.5 of the “limited in its scope” Consumer Code for Homebuilders and SRA rules on conflicts of interest. Yet this has been going on for years! Furthermore, as Patrick Hosking notes in The Times, “there’s a danger the scheme will descend into countless legal disputes, with buyers’ solicitors quickly swallowing up that cash buffer in fees” indeed, as sure as night follows day.

Sebastian O’Kelly, 58, chief executive of the Leasehold Knowledge Partnership, told The Times: “Persimmon has an open-ended liability on the snagging issues. If they build something appalling, and so many of our plc housebuilders build houses and flats with major defects, then they have a responsibility to fix them. I don’t think consumers would be able to take much comfort from this.”

So why are Persimmon doing this?
The homebuyer retention initiative comes following statements that the company is to improve customer satisfaction levels after being dogged by complaints about poor build quality. There had been murmurings lately about a buyer’s retention. Paula Higgins from the Home Owners Alliance told The Times last month that her idea of buyer’s being able to hold a 2.5% retention for 6 months “would be a powerful incentive for builders to put problems right”   I told The Times it would be an “administrative nightmare” and that “6 months would be too short.” Unbelievably, I even found myself agreeing, for the first time, with Steve Turner of the Home Builders Federation , when he said that “introducing retentions as the rest of the construction sector is scrapping them is a crude and naïve suggestion that could reduce consumer protection and risks creating a long drawn out legal process – the new homes ombudsman is a better way to help buyers.”  Trade bodies call to scrap retention Retention in construction under review

Pressure from Government – withdrawal of Help to Buy
In February, The Guardian reported that Persimmon’s right to use Help to Buy was under the scrutiny of Housing Secretary James Brokenshire, who was considering stripping Persimmon of its right to sell properties using Help To Buy because of poor satisfaction levels and concerns on the housebuilder’s behaviour. Persimmon has benefitted immensely from the Help to Buy scheme. Nearly half its 16,449 home sales last year were made through the taxpayer-funded scheme.

A source close to the minister said:
“Leasehold, build quality, their leadership seemingly not getting they’re accountable to their customers, are all points that have been raised by the Secretary of State privately,”

Help to Buy, should never have been extended and should now be cancelled on economic grounds but, if the government wants to keep the housebuilders’ gravy train running, originally due to end in 2016 yet twice extended, first until March 2021 and more recently to March 2023, Government should at least attach a few requirements and conditions that specifically benefit new homebuyers.

Persimmon needs evidence to shoe that they are changing their behaviour under the threat of parliamentary time being found to debate this, perhaps even a select committee inquiry. The homebuyer retention scheme, weekend appointments and the changes to customer care availability hours are little more than tokenism to keep government at bay. It looks like a cheap PR job which has given the company some much needed, positive, coverage in the quality national press.

Persimmon’s premium rating by the NHBC and LABC/PREMIER GUARANTEE may have increased dramatically. The homebuyer retention scheme may be being used to reduce their warranty premiums like an insurance voluntary excess.

An attempt to improve Persimmon’s dire HBF 8-week survey 3 star rating
Persimmon rated 3 star for 5 years in a row!Persimmon Homes have been rated just 3 stars for the fifth year in a row. Jenkinson even mentions the “contracted retention, which will, give homebuyers far greater satisfaction at the completion of the purchase” –  in other words early on, just as the 8-week, HBF survey arrives in their post or inbox. Is it really an “unambiguous signal of cultural and operational change at Persimmon, putting customer care at the very centre of the business.” or a calculated measure to improve their HBF 8-week survey scores and 3-star rating? Given Persimmon claims 79% “satisfaction” which is just 1% below the 4 star rating, you would think giving a few £250 John Lewis vouchers to buyers would have been a cheaper option!

A spokesman for the Home Builders Federation told The Times: housebuilders had “delivered consistent improvements in customer satisfaction over the past two years” and he was again not keen on Persimmon’s housebuyer retention saying it “should not be seen as an option for housebuilders generally.”

No doubt with Persimmon now learning how to “play the star rating game” the heavy weighting of their current 3-star rating drag on the overall satisfaction scores over the last 5 years, the overall satisfaction score at least, is certain to improve, even if in reality, the actual new homebuyer satisfaction does not.

This industry’s reinterpretation of defect into snag has been one of the great distortions of the narrative surrounding new homes in recent years. The likes of Persimmon will be more than happy to agree a 1.5% retention – which they are likely never to have any intention of recovering, is cheap when compared to the loss of access to Help To Buy and other possible government sanctions such as a land-banking tax.

A clear indication that Persimmon has got this wrong is their statement:
“we hear the message that we need to continue to raise our game in customer care.” When actually it is the quality of construction and inspection regimes where improvements are required. It is not a case of putting out the fires quicker, but of fire prevention, getting it right first time, or at least before buyers get their keys!

As with Barratt in the eighties, it will take a generation to turn around Persimmon’s reputation, forever historically tarnished by corporate greed, poor quality homes and contempt and indifference to its own customers. Britain’s top site managers won’t want to go there and have their CVs forever tarnished. Those that do, will justifiably demand huge salaries for their sacrifice. In directing attention to the newly moved in and including quality and customer care in site managers’ bonus calculations is a step in the right direction that should improve their HBF survey star rating. It is a recipe that Barratt have adopted with success over nine, 5-star rated years. It is amazing it has taken Persimmon so long to either begin to care about it, or cotton on!

Persimmon Annual Report 2018 27 Feb 2019
Range of new customer service initiatives implemented in late 2018 showing encouraging initial results. The Group is confident these measures will improve its customer satisfaction score once they have had time to take effect”

CEO Dave Jenkinson “A wide range of projects to improve customer satisfaction commenced in late 2018 and the initial results have been encouraging, giving us confidence in our ability to make progress in this important area”

Chairman Roger Devlin: “Alongside that we are changing our pay and incentives to include greater emphasis on both quality and customer care with plans that are more rigorous than we have had in the past.

“Delivering a good quality product for our customers and providing high levels of customer service throughout the home buying process is a top priority for the business. For the year to 30 September 2018, the percentage of our customers who would recommend Persimmon to a friend under the independent Home Builders Federation (HBF) survey was 79%, in line with the prior year and just short of the four star threshold of 80%. The Group has continued to invest in its customer care systems and resources during the year and this will continue to be the case in 2019 as we remain determined to improve customer satisfaction levels.”

But talk is cheap! Persimmon have said it all before!

Persimmon Annual Report 2016 27 Feb 2017
“During 2016 we have continued to invest additional resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating. This is yielding further improvement in performance with the majority of the Group’s operating businesses showing progress. Prior to customers moving into their new home we have improved our communication processes with them to provide greater understanding of the progress we are making in constructing their new home. We have strengthened our build management processes to facilitate delivery to expected timeframes. Additional support is being provided through reinvigorated processes to demonstrate the features of the new home to customers, assistance with identifying any small remaining issues on moving in day and providing improved systems and processes for our customer care teams to support the prompt rectification of any outstanding matters. Customer care performance is reflected in relevant employees’ remuneration to support a closer alignment to the Group’s objectives. Whilst these initiatives are delivering tangible improvements in our customer satisfaction ratings we remain determined to deliver further advancement this year.“

Persimmon  Annual report 2015 on 22 February 2016.
CEO Jeff Fairburn stated:
“The Group’s priority is to serve our customers well by providing good quality new homes and great service. All of our team are[sic] responsible for delivering high levels of customer satisfaction….Our sales teams across the business are trained to provide excellent levels of service to our customers.”

“During 2015 we invested substantial resources in new customer focused initiatives to improve our customers’ buying experience and our NHBC/HBF 3 star rating. We have introduced dedicated customer liaison managers on our larger sites, improved communication processes with our customers, introduced new processes to strengthen our build programmes and provided additional resources in our customer care teams. These initiatives are showing some early signs of improvement in our customer satisfaction ratings and we will continue to pursue this agenda to secure further progress this year.”

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Fitting carbon monoxide alarms in new homes should be mandatory

Carbon Monoxide Alarms

The fitting of carbon monoxide alarms in new homes should be a mandatory requirement of the Building Regulations in England and Wales.  It may come as a surprise to learn that every year over 4,000 people are admitted to hospital with carbon monoxide poisoning that could lead to brain damage and strokes – with 40 fatalities recorded in England and Wales. One in nine British homes have boilers classified as unsafe.

The new home defect that kills

You can’t see it, you can’t smell it. Carbon Monoxide – the new home defect that kills!

In Scotland and Northern Ireland, the equivalent to the building regulations, requires a BS EN 50291 kite-marked carbon monoxide alarm to be fitted when any new or replacement fuel appliance is installed (except cookers). This covers any fuel burning appliance, including those that burn gas, oil, coal and wood. The alarms must be fitted in any room with the appliance or if it is an enclosed boiler, just outside the enclosure and any room that has a flue running through it. Alarms can be mains or battery powered but if the alarm is battery powered then the battery should last for the life of the alarm.

No requirement in England and Wales:
But the Building Regulations for England and Wales, Approved Document J, only require carbon monoxide alarms to be fitted when any new or replacement solid-fuel appliance is installed. Examples of solid fuel burning appliances being wood burners, open fires etc. There is also additional legislation requiring a carbon monoxide alarms to be fitted in all rented residential accommodation with gas appliances, but not in owner-occupied homes.

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Carbon Monoxide Poisoning Risk In New Homes

Is your new home killing you?

Killer new homes - carbon monoxide poisoningThe shocking truth is, any new home built since 2000 that has a gas central heating boiler could be lethal. There is now widespread recognition that systems with concealed twin extended boiler flues, pose a significant risk of carbon monoxide poisoning. I am calling for a mandatory requirement that all new homes must be fitted with carbon monoxide alarms.  In addition, every new home must be independently inspected, not merely ‘signed off’ and certificated  by the installer.

Carbon monoxide poisoning kills

14 November 2007
Maria Ighodalo (28) dies from carbon monoxide poisoning
London and Quadrant housing association tenant, Maria Ighodalo, died in a block of flats, known as ‘Beulah Hill’, in Upper Norwood from carbon monoxide poisoning. The flat had a gas safety certificate and a concealed flue heating system.

27 February 2008
Elouise Littlewood (26) dies from carbon monoxide poisoning
You would think that following the tragic death of 26 year-old dance teacher Elouise Littlewood on 27 February 2008, who died from carbon monoxide poisoning from a faulty boiler installation in her flat on the Barratt development at ‘Bedfont Lakes’ in Notting Hill West London, that all house builders would be double checking every boiler in every new home they build, to ensure they are 100% safe and installed to manufacturer’s and GasSafe instructions.  Elouise bought the two-bedroom property through a shared ownership scheme with Notting Hill Housing confirming: “Barratt had installed the gas system and produced a gas safety certificate with a one-year guarantee.”

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Commons Debate Leasehold New Houses Scandal

“The PPI of the house building Industry”

The APPG for Leasehold and Commonhold Reform managed to secure a debate in the commons chamber on Tuesday 20th December 2016 to discuss the leasehold new houses scandal. With 53 APPG members, it was surprising that only 13 MPs and Housing Minister Gavin Barwell attended initially. I previously highlighted the scandal of leasehold new houses on 7 November 2016 entitled “The next mis-selling scandal” This phrase apparently being picked up, with the Labour MP for Ellesmere Port and Neston, Justin Madders calling the practice during the debate as “the PPI of the house building Industry”. See also Never buy a leasehold new house 28 October 2016

leasehold new houses scandal

Leasehold new houses scandal

LeaseholdAn analysis by the excellent campaign group  Leasehold Knowledge Partnership (LKP) in November 2016, revealed that 8,775 new-build leasehold houses totalling nearly £2billion were sold in England and Wales last year. In all around 45,000 new houses have been registered as leasehold. Many of these bought with help from taxpayers’ through the Help to Buy scheme. In most cases, the housebuilder sells the freehold after a couple of years to a private company, which can then demand extortionate fees from homebuyers.

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Leasehold new houses – the next mis-selling scandal?

Caught in a trap – Leasehold new houses

Given the information, no new homebuyer would ever choose to buy a house with a leasehold title. Perhaps this is why some housebuilders hide this extremely important information from new homebuyers. Even if they do think to ask about the property title, it’s no good saying “People are scared of change because it’s something new. But it’s virtually freehold.” As a Persimmon sales advisor told a reporter from The Guardian.

leasehold new houses

Is it Freehold? New homebuyers are getting caught out by newly-built leasehold houses.

Justin Madders MP for Ellesmere Port and Neston, is calling for a ban on leasehold new houses:

“It is clear this system is being abused to drive huge profits at ordinary ­homeowners’ expense. There is no need for there to be leasehold properties, particularly those on an estate where the properties are mainly detached houses.

“They need to be banned – it may be a convenient way for developers to get extra profit from their building work, but once they get in the hands of these private equity companies the profit motive overrides any considerations that there are real people living in their homes, who are being asked to stump up eye-watering sums.”

As Patrick Collinson reported in The Guardian on Saturday 29 October 2016, a new house built by Taylor Wimpey in Ellesmere Port was sold for £155,000 on a 999-year lease in 2009. Seven years later, the owner was quoted £32,000 to buy the freehold from E&J estates who had bought the freeholds from Taylor Wimpey. Another buyer was quoted up to £40,000 by E&J estates for the freehold of their 2011, 4-bedroom £122,000 house and despite a long lease, another new homebuyer in Manchester is was forced to pay £38,000 to buy the freehold on their recently built home.

Escalating ground rent is another issue. Taylor Wimpey set the ground rent at £295 a year on the Ellesmere Port development, with the contract stating that ground rent will double every ten years!

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Make Sure Your New House Is Not Leasehold

Buyer beware: The great leasehold new house scam

When will the incessant greed of housebuilders reach its zenith? Not content with charging premium house prices, large plc housebuilders keep coming up with new ways to squeeze every last drop of additional profit from unsuspecting new homebuyers. It started with overpriced optional extras and upgrades. Then shared driveways and non-existent front gardens enabled housebuilders to cram in even more homes on their developments. Persimmon road not finished 30 months after last home sold.Next came the Freehold house with Leasehold type management charges – inescapable “annual rentcharges for maintenance of communal amenities on the development”, commonly around £200 a year for each home, normally for ‘maintaining’ landscaped areas.

Also becoming increasingly common, are charges for private roads, footpaths and street lighting on developments. These charges are even more galling when builders fail to fully-complete these areas for months, sometimes years after the last house was built and sold.

The website Home Owners Rights Network has been set up to fight the unfairness of these charges and campaign for a change in the law. The Leasehold Knowledge Partnership was set up to protect ordinary leaseholders.

Now some housebuilders have taken fleecing buyers to a whole new level. Selling Leasehold new houses, but at Freehold prices. There can be no other reason for this other than to increase their bottom line. As the Daily Mail reported in May 2015, two new housing estates were being built in on either side of London Road in Peterborough. At the time, Persimmon were building 50 new homes at “The Edge” on the east side, selling three bedroom homes for £158,995 – £180,000. On the other side of the road at “The Sycamores” Barratt were building 80 new homes, almost identical in appearance, with a three-bedroom property costing from £163,995.

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Persimmon Homes Employee Reveals All In Secret Recording Of Meeting

Persimmon Contracts Manager’s site meeting rant.

Secret recordingA few weeks ago I was given part of a secretly recorded site meeting. In the recording, which I am of the opinion is genuine, a Persimmon contracts manager expresses his opinions.  The priorities of Persimmon Homes – would appear to be, build as many new homes, as quickly as possible. Or in his own words let’s make as much f***ing money as we can; let’s slash out as many f***ing units as we can because the market allows us.”  

This is part of a two-hour recording, made in November 2015 during a Persimmon Homes South Coast Region sub contractor’s site meeting. It was sent to me by one of the sub contractors, also told me:

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Builders shares crash as Britain votes to leave the EU

It would appear that the house builders’ share price rise since the financial crash of 2008, has been built on the same dodgy foundations as some of their houses are. A business model built on selling sub-standard houses to sub-prime borrowers.

This was illustrated during the first two days of trading following the UK’s historic vote leave the EU. Worst hit in the initial market panic were Banks and shares in the listed house builders. Despite this, some ever-greedy directors used the Friday crash to buy more shares on the cheap, known as “catching a falling knife” and promptly lost another 15%! Taylor Wimpey Non-Exec director Dame Kate Barker, 59, who produced the Barker Review on housing supply in 2004 – which resulted in the industry setting up the HBF Customer Satisfaction Survey two years later, but has failed to have any impact on improving either supply or quality – bought 20,000 Taylor Wimpey shares for £26,953 but the shares closed down 15% leaving her with a paper loss of £3,800.

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