Last month, we wrote about the onerous ground rent clauses affecting homeowners who had bought new-build properties as leaseholds.
Today, the government has announced it is to introduce a consultation with the aim of outlawing developers selling new-build houses as leasehold. This follows widespread criticism of national house builders selling new houses as leasehold, with ground rent charges that can double every ten years.
Houses sold as leaseholds
While flats are often sold as leasehold, in the last decade there has been a growth in new houses being sold in the same way, where the leaseholder does not own the land on which the house is built and has to pay ground rent. Developers have then sold the freehold to investment companies who are getting the benefit of the ground rent. The government white paper will also consider dramatically reducing ground rents that have crippled home owners, as they cannot remortgage or sell their homes. “Enough is enough. These practices are unjust, unnecessary and need to stop,” said Local Government and Communities Secretary, Sajid Javid.
The professional negligence team at Lyons Davidson has followed this developing issue closely and acts for many clients pursuing claims against solicitors and other professionals. If you would like legal advice regarding your leasehold house and possible compensation, please contact Michael Hickey on 0117 904 7006 or by email at [email protected].