HOUSE PURCHASE DEPARTMENT:
THE ASSISTED HOUSE PURCHASE SCHEME
(continued)
The Sub-Committee recommended that legal proceedings be taken for the recovery of the arrears and for obtaining possession of the
properties if that course was necessary, in the case of 77 mortgages. This recommendation was made provided that no such proceedings
be taken in cases where it was proposed that the Contractors take over the properties, or where the Public Works and Town Planning
Committee had recommended that an alternative house be offered until such offer was refused, and that, in cases where repairs were
to be carried out, the proceedings be deferred until it was reported to the Committee that the repairs had been satisfactorily executed
or that the tenants had refused to allow the Corporation or the Contractors to have access to the property.
The 77 properties
consisted of 18 Non-Corporation houses with arrears from £5. 7. 10. (34, Trafalgar Road) to £12. 17. 6. (246, Orphanage Road), and
59 Corporation houses with arrears from £5. 2. 6. (149, Brookvale Park Road) to £25. 5. 1. (1037, Tyburn Road). Of the Corporation
houses, 22 properties were in Tyburn Road and16 in Welland Grove.
Further recommended action was:
- that the necessary proceedings
be taken for possession with a view to the sale of 3 properties by the Bank (47 Avondale Road; 69 Bramley Road; 47 Kingscliffe Road);
-
that Frank Wilde to endeavour to sell 3 properties of which the Bank are already in possession and to instruct the Town Clerk and
General Manager to take any necessary steps in the matter (112 Lyttleton Road; 53 Kingscliffe Road; 36 Beauchamp Road);
- that
Frank Wilde be appointed Receiver in respect of the 2 properties, and to instruct the Town Clerk accordingly (40 Woodfield Road, Kings
Heath and 47 Fernley Road, Sparkhill);
- that the General Manager consult with the Estates Department in regard to 8 properties
with a view to such houses being re-purchased (40 Fenton Road; 75 Starbank Road; 4 Tilsley Grove; 42 Findon Road; and 4 houses in
Welland Grove: 7, 8, 32 and 38);
- that the General Manager to endeavour to obtain increased repayments re 45 Welland Grove;
-
that Mr Wilde be instructed to obtain possession and to endeavour to let 16 Morden Road, Stechford on a quarterly tenancy;
-
that the Estates Committee be asked for their decision in the case of 57 Bramley Road, and the City Surveyor asked for his report
as to the condition of 5 Welland Grove;
At the same meeting, the General Manager detailed the 17 cases (Non-Corporation 9; Corporation
8) where Receivership was in operation, but consideration of the matter was deferred.
On December 12th 1927, representatives
of the Bank, Estates, Finance, and Public Works Committees attended a conference called by the Lord Mayor.
MINUTES OF CONFERENCE
PRESENT:
The
Rt Hon The Lord Mayor (Ald A H James, CBE, JP) In the Chair
Ald Sir Percival Bower, MBE, JP & Mr J P Hilton (General Manager) Representing
the Bank Committee
The City Treasurer - Representing the Finance Committee
Councillors Kenning and Godrich and Mr Wallace Smith (General
Manager) Representing the Estates Committee
Aldermen Talbot and Gregory and Councillor Lee; The City Surveyor - Representing the Public
Works and Town Planning Committee
The Town Clerk
The Lord Mayor stated that his action in calling the Conference arose out of
the necessity, in his opinion, of a discussion taking place between the Committees concerned on the housing policy of the Corporation.
The
Lord Mayor proceeded to indicate some of the questions which it appeared to him should be considered by the Conference and submitted
the following points for their observations:
1. The expediency of the Bank Committee
proceeding to enforce legal proceedings against defaulting Mortgagors.
2. In
all such cases, the possibility of the Estates Committee finding approved purchasers for such houses, or, in the alternative, repurchasing
the same themselves and discharging the liabilities of the Bank and Finance Committee with a view to subsequent letting.
3. The reconsideration of the existing terms upon which applicants are enabled to purchase Corporation houses and the question of raising
the initial deposit required to a more substantial figure.
4. The expediency
of the Corporation deciding to accept the resultant loss which necessarily arises through the non-receipt of the Government subsidy
when a house earmarked for sale is brought into the pool for letting purposes, in contra-distinction to the Bank and Finance Committees
being compelled to stand out of the moneys advanced by them to a defaulting Mortgagor.
5. Consideration as to whether in the best interests of the Corporation it is advisable to attempt to continue the sale of Corporation
houses on the present scale, with the view of reducing, as far as possible, the continuing maintenance liability which rests upon
the Corporation in respect of houses let, or whether, in view of the present unsatisfactory condition created by defaulting purchasers
this policy should not be modified and the increased maintenance liability faced if the houses are reserved for letting.
Mr Alderman
Talbot reminded the Conference of the fact that Mr Boswell, the Contractor for the first concrete houses at Pype Hayes, had intimated
his willingness to purchase 13 houses at Pype Hayes in which substantial defects had been admitted, and that the Public Works Committee
had definitely assured the Council that all proved defects should be made good. He therefore suggested that satisfactory arrangements
had been made to remove any grounds for complaints and that proceedings should be instituted against defaulting Mortgagors.
Sir
Percival Bower stated that he desired to make clear what he had already, on behalf of the Bank Committee, informed the previous Conferences,
that in their opinion while there were a number of Mortgagors in default who were prepared to use the agitation in regard to Pype
Hayes Houses as a pretext to be released from their obligations and to be allowed to remain in the house as tenants, there were also
a number of purchasers of satisfactory financial standing who were withholding their repayments on the ground of being in possession
of faulty houses.
He added that a complete list of arrears had recently been considered by the Bank (House Purchase) Sub-Committee
and in 61 cases of Corporation Houses it had been decided to recommend the Bank Committee to institute proceedings for possession
and recovery of arrears without delay, there being 40 cases on the Pype Hayes Estate and 21 other Corporation Houses.
The Conference
proceeded to consider the difficulties which had arisen in regard to Mortgagors of Corporation Houses in default and the uneasiness
expressed by some purchasers as to their liability for future defects which might arise in the properties and also the effect of the
policy of the Corporation in fixing the initial deposit at too low a figure, whereby it was suggested that several persons had been
allowed to become Mortgagors who were not in a position financially to discharge their obligations. The matters raised in the other
questions submitted by the Lord Mayor were also considered, and after hearing the views of the officials of the Departments represented,
the Conference unanimously agreed to recommend the following policy to the respective Committees for adoption, viz:
(1) That
the Public Works and Town Planning and Estates Committees be recommended to accept the offer of the Contractor (Mr Boswell) to take
over at least thirteen defective houses on the Pype Hayes Estate , discharging the Mortgages to the Municipal Bank in respect thereof.
(2)
That, having regard to the fact that the houses on the Pype Hayes Estate have been erected by way of an experiment in "concrete" construction,
the Public Works and Town Planning Committee be recommended to undertake on behalf of the Corporation to make good without expense
to the purchasers all defects in the main structure of such houses which have arisen or which may arise within 10 years from the 1st
January, 1928, and which are attributable to the experimental method of construction.
(3) That, having regard to the fact that
the houses on the Stockfield Estate have been erected by way of an experiment in "concrete" construction, the Public Works and Town
Planning Committee be recommended to undertake on behalf of the Corporation to make good without expense to the purchasers, all defects
which have arisen or which may arise within 10 years from the 1st January, 1928, to the floors of the ground floor rooms of such houses,
and which are attributable to the experimental method of construction.
(4) That the Bank Committee be recommended to defer instituting
proceedings against Mortgagors of Corporation Houses in default, pending a further survey of such houses being made and an assurance
being received from the City Surveyor in each case that such houses are in good condition, and also until the Mortgagors concerned
have been notified of the guarantee of the Public Works and Town Planning Committee above referred to, and the intention of
the Bank to take proceedings unless the arrears are paid.
(5) That in cases of Corporation Houses where the Bank Committee eventually
decide to take proceedings and possession is obtained, the Estates Committee be recommended to take over the properties with a view
to re-sale, and to arrange in conjunction with the Finance Committee for the Bank Mortgages to be discharged, on the understanding
that, in the case of re-sale, the Bank Committee would be prepared to make further advances on the properties to approved new purchasers,
if required.
NOTE. In this connection it was considered advisable to avoid, if possible, the letting of such houses, as in that
event there would be an annual loss of £4. 10. 0. plus the difference between the 1923 and 1924 subsidy, amounting for the first 20
years to £3 per annum, or a total capital loss of £156 to the Corporation in respect of each house.
(6) That the Estates Committee
be recommended, as far as possible, to restrict the sale of houses, for the time being, to the aforesaid houses on the Pype Hayes
and Stockfield Estates, it being understood, however, that applications which have already been accepted will be proceeded with on
the terms at present obtaining.
(7) That the Estates, Finance and Bank Committees be recommended to agree that the amount of
Minimum deposits required from prospective purchasers of Municipal Houses. including houses sold to sitting tenants or re-sold as
recommended in (4) above, shall in future be as follows:
(a) For Parlour type houses £60
(b) For Non-Parlour type houses £50
The Lord Mayor called a further Conference on January 5th 1928:
MINUTES OF SECOND CONFERENCE
PRESENT:
The Rt Hon The Lord Mayor (Ald A H James,
CBE, JP) In the Chair
Ald Sir Percival Bower, MBE, JP, Councillor Cooper & Mr J P Hilton (General Manager) Representing the Bank
Committee
Alderman T O Williams & The City Treasurer - Representing the Finance Committee
Councillors Kenning, Godrich & Roberts
and Mr Wallace Smith (General Manager) Representing the Estates Committee
Aldermen Talbot & Gregory and the City Surveyor - Representing
the Public Works and Town Planning Committee
The Town Clerk
The Minutes of the Conference held on 12th December, 1927 were confirmed
and signed.
The following Resolutions passed by the Bank, Estates, Finance, and Public Works & Town Planning Committees upon
consideration of the recommendations contained in the Minutes of the Conference above mentioned were received:
Bank Committee
(19th December)
Minutes of the Conference on Housing convened by the Lord Mayor and held on the 12th December, 1927 were received:
2880 RESOLVED:- That the recommendations contained in the foregoing Minutes of the Conference be approved and that, subject to the approval
of the other Committees concerned being obtained thereto, the necessary steps be taken by the Bank to give effect to the policy therein
contained.
Public Works and Town Planning Committee (22nd December)
RESOLVED:- That, having regard to the fact that the houses
on the Pype Hayes Estate have been erected by way of an experiment in "concrete" construction, this Committee do hereby undertake
on behalf of the Corporation to make good without expense to the Purchasers or the Estates Committee all defects in the main structure
of such houses which have arisen or which may arise within ten years from the 1st January, 1928, and which are attributable to the
experimental method of construction.
RESOLVED:- That having regard to the fact that the houses on the Stockfield Estate have been erected
by way of an experiment in "concrete" construction, this Committee do hereby undertake, on behalf of the Corporation, to make good
without expense to the Purchasers or the Estates Committee all defects which have arisen or which may arise within ten years from
the 1st January 1928, to the floors of the ground floor rooms of such houses, and which are attributable to the experimental method
of construction.
Estates Committee (20th December)
Pype Hayes and Stockfield Estates.
The Minutes of a Conference held between
representatives of the Bank, Estates, Finance and Public Works & Town Planning Committees on December 12th were read.
(Here follow
Minutes)
After prolonged discussion it was agreed that the various recommendations of the Conference should be dealt with as follows:
(1)Purchase of defective houses.
Defer consideration. In the meantime the General Manager to ascertain the terms upon which Mr Boswell
would purchase the 13 defective houses referred to.
(2) and (3) Repair of Defects
Approve, subject to deletion of words "without
expense to the purchasers" in each case.
(4) Proceedings against Mortgagors.
Approve.
(5) Re-sale of houses.
Approve, subject
to the following amendments:
For the words "take over the properties with a view to resale" in lines 3 and 4, substitute "undertake
the resale of the properties as agents for the Bank Committee".
Add "on the low deposit system" after the word "purchasers" in the
last line but one.
(6) Restriction of sales.
Approve.
(7) Increase of minimum deposits.
Reject.
Finance Committee
(30th December)
On Minute No 3409 (Conference of representatives of the Bank, Finance, Estates, and Public Works Committees on the
sale of Corporation Houses) Minutes of Proceedings of the Conference were submitted.
RESOLVED:- That this Committee approve of the
recommendations contained in the foregoing Minutes of Proceedings so far as the Finance Committee are concerned.
The Lord Mayor
pointed out that the recommendations of the last Conference had been accepted by the Committees concerned with the exception of the
Estates Committee, and having explained the effect of the decisions of the latter Committee and the alternatives open to the
Conference he suggested that they should consider each of the amendments separately with a view to dealing satisfactorily with the
objections of the Estates Committee.
The Conference thereupon proceeded to discuss and deal with the amendments in question,
as follows:
No 1 Purchase of defective Houses.
The Estates Committee's representatives stated that their Committee were somewhat
anxious as to what arrangements would be made with regard to the occupiers of the houses taken over by Mr Boswell. After an assurance
had been given on the part of the Public Works & Town Planning Committee that in the making of any necessary arrangements the
Estates Department should be consulted, the Estates representatives agreed to recommend their Committee to approve the proposal of
the Conference.
Nos 2 and 3 Repair of Defects
In view of the fact that the Public Works and Town Planning Committee had
extended their ten years guarantee to include the Estates Committee as well as the purchasers, the Estates representatives stated
that their point had been met and they agreed to the re-insertion of the words "without expense to the purchasers" with the addition
of "or the Estates Committee" in each case.
No 5. Re-sale of Houses.
The Estates Committee's representatives intimated that their
Committee objected to the proposal of the Conference on the ground that any ultimate loss would be shewn in the expenditure of the
Estates Committee. An assurance was given by the Conference and the Chairman of the Finance Committee that any such loss would be
met by the Corporation out of the Borough Fund and would not constitute part of the expenditure of the Estates Committee. To meet
the point raised as to deposits, the Bank Committee's representatives intimated that in respect of the properties referred to in the
recommendation they would ask the Bank Committee to agree to the low deposit facilities being granted to purchasers on the resale
of such properties. It was accordingly decided that the recommendation of the Conference should be again submitted to the Estates
Committee with a view to its adoption in the following form:
(5) That in cases of Corporation houses where the Bank Committee eventually
decide to take proceedings and possession is obtained, the Estates Committee be recommended to take over the properties with a view
to resale, and to arrange in conjunction with the Finance Committee for the Bank Mortgages to be discharged, on the understanding
that, in the case of resale, the Bank Committee would be prepared to make further advances on the properties to approved new purchasers
on the low deposit system, if required.
No 7. Increase of minimum deposits.
The Conference discussed at considerable length the
action taken by the Estates Committee in rejecting the recommendation of the Conference with regard to the increase of minimum deposits.
Councillor
Roberts stated that this decision, although not unanimous, was arrived at by the Estates Committee on the ground that no reasons had
been advanced to that Committee or facts disclosed which justified the present policy of low deposits, as laid down by the Council,
being altered, but it was possible that with full particulars of the difficulties experienced by the Bank before them, after examination
they might reconsider their decision. For his own part he viewed with concern the ownership by the Corporation of large blocks of
newly erected houses and was very anxious that the houses should be owned by the occupiers. He was, however, apprehensive that the
increased deposits would curtail the sale of these houses, and suggested that, even if the present policy of low deposits resulted
in a loss to the Corporation in a few cases, such loss would not be so great as the capitalised loss represented by the yearly charge
to be borne by the Corporation in respect of houses let at uneconomic rents.
It was pointed out by Sir Percival Bower that at
the last Conference, he had submitted detailed figures showing the position with regard to arrears generally and with respect to Corporation
houses in particular giving separate figures with regard to Pype Hayes. He would, however, be prepared to have the Lord Mayor supplied
with certain information to be used in such manner as he might think proper. He added that, while as a whole the position regarding
Mortgagors in arrears was exceedingly satisfactory, some anxiety was felt by the Bank Committee regarding the position on the Pype
Hayes Estate where since the last Conference the number of defaulting Mortgagors had considerably increased, and it was considered
that the difficulties which had arisen in recovering the arrears were due in part to the adoption of the policy of low deposits.
The
Conference, with the exception of Councillor Roberts, were strongly of opinion that the increased deposits recommended by them should
be adopted, among the reasons which actuated them in arriving at and adhering to their decision being (a) to minimise the risk of
any loss which might subsequently be incurred as a consequence of the sale of Corporation houses and (b) to ensure as far as possible
that the purchasers are persons whose resources permit of them undertaking the responsibilities involved by the purchase of a house.
Accordingly it was considered desirable that the Estates Committee should be asked to reconsider their decision in the matter, and
it was:
RESOLVED:- That the recommendation of this Conference with regard to the increase of minimum deposits be again submitted to the Estates Committee, and that they be strongly urged to adopt the same, also that the Lord Mayor be empowered to lay before the said Committee any facts or figures he may consider desirable from information supplied to him by the General Manager of the Bank.