Unfair Leasehold Contract - GOV whitepaper

Experting

For those with a dodgy leasehold contract (Doubling of ground rent every 10 years) to an unsustainable amount. I have seen on the GOV website that they are doing a white paper on it and are looking for people to take part. I guess the more information they get the quicker/harder they should be able to act. May aswell take part and hopefully change the law on it in the UK.

https://www.gov.uk/government/consultations/tackling-unfair-practices-in-the-leasehold-market

Patrick_Stewart

Thank you, this is happening to me and I only own a flat. When it comes to extending the leasehold it seems, at least in my case, the freeholder is taking the opportunity to extend it with unsustainable ground rent, as you describe.
I thought this was just a problem with some dodgy newbuilds, but to have this happen to me, when leasehold for an old flat is quick common place, is quite worrying. Hopefully the government will shut this down. I am having to go through the full legal route to make the ground rent a peppercorn because all extensions offered by the freeholder were obvious profiteering.


Can anything be done about surveyors overestimating the leasehold value? Seems mad that my surveyor can come up with an estimate that it £4000 less than the profiteering freeholder's surveyor? What are we paying surveyors for?? Making up estimates?

eddddy

Patrick_Stewart wrote: »

Thank you, this is happening to me and I only own a flat. When it comes to extending the leasehold it seems, at least in my case, the freeholder is taking the opportunity to extend it with unsustainable ground rent, as you describe.
I thought this was just a problem with some dodgy newbuilds, but to have this happen to me, when leasehold for an old flat is quick common place, is quite worrying. Hopefully the government will shut this down. I am having to go through the full legal route to make the ground rent a peppercorn because all extensions offered by the freeholder were obvious profiteering.


Can anything be done about surveyors overestimating the leasehold value? Seems mad that my surveyor can come up with an estimate that it £4000 less than the profiteering freeholder's surveyor? What are we paying surveyors for?? Making up estimates?

On the plus side, it's good that the government has introduced legislation that gives the leaseholders the right to compulsorily purchase (statutory) lease extensions.

I guess with a 'compulsory purchase', agreeing a price that is fair to both buyer and seller is always going to be an issue.

Regarding the £4K difference in valuations - they are done using a statutory calculation, but based on assumptions.

Have you seen the calculations, and the different assumptions that each valuer has made?

Your valuer should be able to explain to you why the assumptions are different.

Experting

Patrick_Stewart wrote: »

Thank you, this is happening to me and I only own a flat. When it comes to extending the leasehold it seems, at least in my case, the freeholder is taking the opportunity to extend it with unsustainable ground rent, as you describe.
I thought this was just a problem with some dodgy newbuilds, but to have this happen to me, when leasehold for an old flat is quick common place, is quite worrying. Hopefully the government will shut this down. I am having to go through the full legal route to make the ground rent a peppercorn because all extensions offered by the freeholder were obvious profiteering.


Can anything be done about surveyors overestimating the leasehold value? Seems mad that my surveyor can come up with an estimate that it £4000 less than the profiteering freeholder's surveyor? What are we paying surveyors for?? Making up estimates?

The freeholder will always try and make maximum money, no surprise there! Although don't get me wrong some of them are good... but the majority are not.

Does the freeholder not want to meet in the middle of them estimates? Its still a cost to you, but not as much. Unless you go for a 3rd valuation? Not had the chance too renew a lease yet so i can't comment too much.

eddddy

Experting wrote: »

Does the freeholder not want to meet in the middle of them estimates? Its still a cost to you, but not as much. Unless you go for a 3rd valuation? Not had the chance too renew a lease yet so i can't comment too much.

There's not really a concept of going for a 3rd valuation. There's a well defined statutory process that has to be followed.

The leaseholder and freeholder (or more often their respective valuers) will negotiate. If they cannot reach agreement, it will have to go to a tribunal - and the tribunal will decide.

It's sometimes worth the leaseholder offering a bit more, to avoid the high costs of a tribunal.

davidmcn

Experting wrote: »

May as well take part and hopefully change the law on it in the UK.

ITYM "in England & Wales". Not all UK jurisdictions have to put up with this nonsense...

ceecee1

Worth looking at the National Leasehold scandal Facebook page

nikkih72

https://www.facebook.com/groups/786983251448976/

Experting

Great Facebook page too