Property Ecosystem

A business ecosystem is the network of organisations, suppliers, distributors, customers, competitors and government agencies that are involved in the delivery of a specific product or service through competition and cooperation.

Residents First believes that the residential property industry is a good example of such a business ecosystem.

The diagrams below shows the various interactions between stakeholders in the context of Freehold and Leasehold models. We have highlighted the groups that we consider Residents from our perspective.

The Freehold Model

The freehold model typically involves six parties, although Housing Associations and Tenants fitting into this picture as well.

A Housing Association can be considered a Freehold Owner.

Tenants have a simple relationship with the Housing Association.

The Leasehold Model

The leasehold model typically involves one extra party: the Leaseholder!

This model is based on a tri-partite arrangement which involves the Freehold Owner, Leasehold Owner and a Management Company.

A simpler bi-partite arrangement is less often used whereby it just involves the Freehold Owner and the Leasehold Owner.

The Residential Building Industry

The residential building industry in the UK is worth about £75bn with almost 50,000 construction companies sharing that market. New build completions account for around 200,000 of new housing supply each year. [Stats correct as of 2020]

Demand for new housing has outstripped supply for years which means the house purchasing process is controlled by Developers.

Secondary industries that rely on the supply of new build homes (e.g. Managing Agents) keep new-build homeowners at arm’s length, leaving residents feeling unempowered and in the dark.

That’s why we believe it’s time to make some changes!