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Homebuyers Paying Off Objectors: How Delayed Construction Projects Are Costing Homeowners

Lia had to deal with it. In the autumn of 2021, she bought one of seven homes to be built on the water near Den Bosch.

Two local residents opposed the new construction and went to court. But before the case was heard there, it was soon August 2023. And a final decision was not made until November ’23.

Horror

All this time the builder could not start building. Because the permits granted by the municipality were not irrevocable. And without irrevocable permits, the developer was unable to finance the project.

Lia followed it all with horror, she says. “We had sold our old home, but at some point we simply had to move out, and we had an advantageous mortgage offer that we were ultimately unable to sign.”

The project developer entered into discussions with the objectors and offered 10,000 euros per person to withdraw the procedures. Lia herself also tried to have the appeal procedures withdrawn and was willing to pay money for this. But it all led to nothing.

The project developer rejected a counter-proposal asking for €100,000. That amount was just ‘craziness’, the relevant objector said afterwards. But there are cases where project developers are willing to pay hundreds of thousands to avoid delaying large-scale projects. And so Lia was left without a home.

metric tons

Although exact figures are not available, according to the Association of Dutch Project Development Companies (NEPROM), it ‘often’ happens that developers buy off objectors to prevent new construction projects from being delayed or no longer able to go ahead. Professor of Housing Market Peter Boelhouwer from TU Delft also knows the stories.

In 2020, Wijnhaven Island in Rotterdam made the news because ‘some residents collect a lot of money through legal objection procedures’. “They only withdraw their opposition to new construction after a generous settlement with a project developer“, wrote the AD-Rotterdams Dagblad

Warp and woof

“It has been happening much more often lately than before,” says NEPROM director Jan Fokkema. Fokkema itself has ‘ten, fifteen projects’ in which developers bought off objectors. According to him, this creates financial and ethical dilemmas.

“Everyone finds it incredibly annoying if he or she gives in. But under pressure from, or with a view to the interests of the buyers, there are those who say: if I can buy it for a certain amount, then I can continue. That saves me so much time and money.”

Cold calculation

Whether all objectors are always after money is, according to Fokkema, ‘very difficult to judge from a distance’. “You can’t look into people’s heads. There are also objectors who are simply against any change in their neighborhood. They just don’t want something.”

The fact that appeal procedures at a court can easily take up to a year and that the average processing time for an appeal at the Council of State is another 46 weeks does not help, according to Fokkema. This means that a new construction project can come to a standstill for a ‘long’ period, with all the associated costs and risks. A developer who makes a cold calculation can easily be tempted to embark on the ‘slippery slope’ of a lump sum payment.

Speed ​​up procedures

NEPROM has therefore long been advocating for the acceleration of procedures in housing construction, so that everyone knows sooner where they stand. Professor Boelhouwer also thinks acceleration is a good idea. “If it is really clear that objectors do not have a compelling interest, you could accelerate new construction through an accelerated procedure.”

Outgoing Minister Hugo de Jonge of the Interior and Kingdom Relations, responsible for public housing, announced a plan of approach to accelerate the development of a housing project. This is now an average of ten years.

One of the measures is to shorten the objection and appeal phase, whereby in some cases a judge can be skipped and the objections are handled directly by the Council of State. But that came too late for Lia.

Lia chose her money’s worth

“We eventually bought a house somewhere else. The mortgage interest rate had risen sharply in the meantime,” she says. Lia has calculated that it will save her 214,000 euros over the term of the new mortgage.

She calls the whole thing horrible. According to Lia, it was clear in advance that the objections had no chance of success, which the Council of State actually determined at the end of last year. “One of the objectors did not even have a direct view of the new houses from his home. But such a person could also cause two years of delays and enormous damage.”

Call

Do you also have experience with buying off objection procedures and would you like to tell your story about this to RTL News? Contact the editor. Preferably with a telephone number.

2024-01-06 15:18:29
#Developers #offer #big #money #stop #resistance #construction

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