Holiday and Home Park Industry Owners and Investors – Who owns what?

The UK, particularly England, has seen investment opportunities in the holiday and home parks market in recent years. For those seeking out these opportunities to own or invest, it is important to understand the legal interests created between park owner/operators and unit owner/occupiers – just who owns what, when it comes to the home or caravan and the plot of land it sits on?

Residential and Holiday Park Distinction

There are two types of ownership a park owner or operator can grant to a person wishing to purchase or put a mobile unit on a park –

1. Residential: A 'Written Statement' made in accordance with the Mobile Homes Act 1983 (MHA). This creates a legal interest entitling an occupier (a) to station a mobile home on land forming part of a protected site; and (b) to occupy the mobile home as his only or main residence.

2. Holiday: A 'pitch licence', which grants permissions to put a holiday caravan on a particular plot.

Land Registration

Whilst certain protections exist under the MHA and related legislation, these interests are not capable of protection by the occupier or unit owner by land registration. This is because they do not give rise to proprietary interests being created in the land itself and the units are not freehold or long leasehold property in the way, for example, a house is in England. These units are simple chattels (or moveables in Scotland) – a personal possession.

The situation is quite clear-cut in the case of a holiday pitch licence (so long as what is granted is a simple licence and not a lease). A challenge might arise, however, in the case of an MHA Written Statement. Whilst it is not convincing that these interests could survive a park owner’s purchase of registered land, land registration might conceivably be challenged if the person holding a MHA Written Statement is in actual occupation of the mobile home and by inference the land itself, because it could be argued to be an overriding interest in England.

Understanding the nature of occupiers' rights in a particular holiday or home park is crucial in allowing investors or funders to determine the value of such sites. It is imperative for potential investors or funders to undertake full diligence on the legal interests granted by an operator/owner and for the operator/owner to hold a good audit trail of those interests.

If you are an owner, operator or investor involved in the holiday and homes park industry, if you are considering investing or lending into the industry or you have any concerns or questions about the various legal interests created by unit ownership may impact you or your business, please do not hesitate to get in touch with our Real Estate Disputes team or your usual Brodies contact.