1.10.09

Berkeley Director’s Ratner Moment

Following Berkeley Group’s AGM on 9th September 2009, a group of representatives of the Berkeley Homes Collective had a meeting with several Berkeley directors, including Mr Paul Vallone.

During a heated discussion, Mr Vallone was asked why Berkeley refuses to consider any of 13 commercially sensible solutions put to the company by the Berkeley Homes Collective.

It was also highlighted to Mr Vallone that a number of his competitors were working with their buyers to reach a fair and amicable solution and to help people complete on their new homes. In particular Mr Vallone’s attention was drawn to a recent Mail on Sunday article where a spokesperson for arch rival, Barratt Homes confirmed that where genuine owner-occupiers were now in difficulty due to the issues with mortgages and valuations, Barratt were routinely refunding deposits and cancelling contracts.

“Barratt says it routinely refunds deposits to genuine owner-occupier buyers in difficulty, and adds: ‘It is simply not a good idea to threaten our future customers.’ ” Mail on Sunday 14th September 2009.

Mr Vallone’s response was “If you want to buy from the type of company that will renegotiate a contract after its been signed, you should have bought from Barratt”

Mr Vallone was then asked to clarify his comments and he responded with “What I am saying is if you want to change the terms of a contract after its been signed, you should have bought from Barratt. We are not the type of company….”.
Mr Vallone went on to explain that during the boom years, Berkeley didn’t try to put the price up after contracts had been signed and so he’d didn’t see why he should help struggling homebuyers today now that prices had fallen and mortgages hard to come by. What he implied was that Barratt were “the type of company” to change the terms of contracts after they’d been signed.
He clearly missed the point, like most of his colleagues, that this is not just about contracts. This isn’t a clean cut business transaction. These were individuals buying homes from a company they thought they could trust.
What Mr Vallone and his friends are doing are ruining lives and destroying families while hiding behind a faceless contract.
In a classic Ratner moment, the arrogant Mr Vallone, recommended – “You should have bought from Barratt”.
 
Mr Vallone, all of us in the BHC now wish we had bought from Barratt and I’m sure many of our readers will remember this in the future when considering which housebuilder to choose if anyone ever want to buy a new build again. (Not likely).

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    30.09.09

    Why have Berkeley’s flats fallen by 40%? (London average -14%)

    Why have Berkeley’s properties crashed by 40% (45% in one instance at Royal Arsenal Riverside), while the London average fall in prices has been closer to 14%???????

    Still, no-one from Berkeley wants to answer that question.

    Berkeley have offered no explanation, no solutions and no compromise.

    Paul Vallone, Berkeley Homes director, told us he thought the flats were still worth every penny and he’d borrow the shortfall from his granny if he had to because he firmly beleived that a contract was a contract and should be honoured.

    Sorry, Mr Vallone, for those of us looking at £100,000 shortfalls due to the crash in valuations at Caspian Wharf and Royal Arsenal Riverside, my granny’s pension isn’t going to fill the hole.

    Berkelely are still showing a lack of understanding of what has happened to their market in the last 18 months. Mr Pidgley’s letters from 2008 and throughout 2009 clearly show the company as a whole are in denial about the crisis facing the new build sector, but are also clearly dillusional about their customer’s finances.

    Its not the first time a Berkeley staffer has told us that you just can’t compare Berkeley to “the likes of Barratt or Persimmon”. They are clearly deluded in thinking that Berkeley customers are all cash-rich and don’t need a mortgage. Indeed, all of our reservation forms clearly state how we intended to finance our purchasers and in virtually all of those cases it was with a mortgage.

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