Latest figures available reveal that of nearly 47,000 new build homes in the North West sold as leasehold between 2010 -2017, 63% of them were houses, not flats.
Staggeringly, the North West also made up nearly exactly the same percentage of the total number of new build houses that were sold as leasehold nationally during the same period.
The arrangement, which is traditionally most common for flats, means homes are bought but also leased rather than entirely owned, with leaseholders often paying a ‘ground rent’ as well as service charges to the property freeholder, or to a managing agent acting on their behalf.
Homeowners who purchased the leasehold of their property are often locked into contracts forcing them to seek permission to make basic alterations or to build extensions such as conservatories, even if no local authority planning permission is required.
Some leaseholders find they’re obliged to pay extortionate ground rents, while others are locked into rip-off service charges. Many didn’t choose their own solicitor and feel they were poorly advised when purchasing their home.
Southport Labour’s Liz Savage says with numbers rising nationally and over 29,500 new build houses sold as leasehold in the North West since 2010, it’s time for an inquiry into what she believes is yet another mis-selling scandal:
“Leasehold for houses is little more than a con trick as far as I’m concerned. There’s no justification for it and I think it’s little more than a way of duping unsuspecting home-owners out of more cash and possibly even their home.”
“Leasehold for flats is perhaps more understandable when there is shared occupancy and responsibility but it still needs to be made clear when purchasing what it entails. For houses though it makes no sense at all; it isn’t expected or understood and it needs to stop.”
Survey data suggests almost six in ten leaseholders didn’t understand what being a leaseholder meant until they had already purchased the property, and more than nine in ten leaseholders regret buying a leasehold property at all. A total of 4.3 million properties across England – almost one in five of all homes – are now classified as leasehold.
In the House of Commons this week, Labour’s Shadow Housing Secretary, John Healey MP, challenged government ministers to set up an inquiry into the mis-selling of leasehold homes, saying:
“Leaseholders find they’ve bought their home but still don’t own it, and many feel ripped off by unfair leasehold contracts. This is a national scandal but the Government’s action to date has been too weak, too slow and has overlooked the plight of existing leaseholders.”
“Ministers must act to back an inquiry into this systematic leasehold misselling, as with other misselling scandals like pensions, endowment mortgages and PPI.”
“Leasehold for houses is little more than a con trick as far as I’m concerned. There’s no justification for it” – Liz Savage