building owners block flats with better broadband

Tracey Knott, 54, is a small-scale landlord with a flat for sale in Birmingham with a lower than average internet speed. “It doesn’t get much better than dialing in and has been an absolute nightmare,” she said.

In July of last year, her tenant tried to upgrade the internet, but Openreach was unable to install full fiber without permission from the owner, Persimmon, the homebuilder. Ms. Knott stepped in in January and every two weeks haunts the building director, Gateway.

Ms. Knott is now concerned that she will struggle to find new tenants due to the slow internet speed when her tenant leaves later this year. ‘I should probably deduct £50 from the rent,’ she said.

She fears that the property may become unrented as more and more properties get faster internet. “If everyone has 1,000 Mbps, I can only rent out to people who don’t use the internet. And I’ve yet to meet someone who doesn’t,” she added.

House price drops will come

Once Openreach upgrades most homes to full fiber, the gap between homes will be extreme. Mr. Bateman said: “Speeds of 30 Mbps are sufficient for today’s needs of people. But the way we live and work will accelerate as 1,000 Mbps becomes normal.”

This is likely to lead to falls in house prices. Research by the London School of Economics suggested that an upgrade from 30 Mbps to 1,000 Mbps would result in a 3 pc price increase – an increase of £8,310 for a typical home.

Gabriel Ahlfeldt of the LSE said this premium would be higher in urban areas that rely heavily on Internet-based services. In London he estimated the premium at 6 pc, which corresponds to an extra £31,800 on the value of an average house in the capital.

However, once the Openreach rollout is complete, the situation would turn and homes without full fiber would be discounted. “A fast and reliable connection will be universally expected and if it cannot be offered, sellers and landlords will have to be willing to accept significant discounts,” said Mr. Ahlfeldt. This could equate to a drop of between 3pc and 6pc.

Vanessa Hale of Strutt & Parker brokers said the shift to working from home meant broadband was more integral.

“Nearly half of homeowners would not consider moving to a home without good broadband,” she said. “Homes without a first-class broadband connection are undesirable.”

More punishment for leaseholders

Mr Betts added that many of those who will no longer receive upgrades are in the same blocks affected by the building security crisis that emerged in the wake of the Grenfell fire in 2017.

“It is another injustice of the ground lease system. It’s completely unfair, especially since flats often have regular reception problems, which means that the importance of better internet is even greater. This is a very, very big problem,” said Mr Betts.

A government spokesman said: “We agree that unresponsive landowners should not prevent residents from accessing fast, reliable broadband. That’s why we introduced a bill to encourage faster and more collaborative negotiations between landowners and telecom companies, and last year we passed new laws to give companies faster access to condominiums where the landowner doesn’t respond to requests.”

A Persimmon spokesperson apologized for the difficulties on his property. “Given the unacceptable delay, we have reached out to both Openreach and Gateway to attempt to resolve any outstanding issues and will work with them to ensure the necessary approvals are granted as quickly as possible,” he added.

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