Barratt homes leasehold scandal

28tsw

I’m currently buying a Barratt home built around 2015/16

I’m aware of the leasehold scandal and intend to buy the freehold in a few years. 

What I hadnt realised was how the scandal has affected lenders.

can anyone tell me if Barratt homes were one of the builders putting doubling ground rent in leases? I can see Taylor Wimpey and Bellway we’re big can’t get an answer to whether Barratt were

Slithery

Doubling ground-rent isn't necessarily an issue, it all depends on the timescales involved.

10 years bad, 20+ years no problem...

28tsw

Is there any consensus on which builders used which multiplier? 

daveyjp

If you are buying the house get a copy of the lease. 

Also be aware that even if you buy the freehold it may not release you from leaseholder obligations to pay charges such as upkeep of common areas shared with other residents.

eddddy

If you're currently buying a home, the best plan would be to ask the seller via the EA about the ground rent terms.  If the seller claims not to know, maybe hold back on spending too much money until you find out. 

If it turns out that the ground rent makes the property unmortgageable, I think the Property Ombudsman might say that is information that the EA should have found out and should have told you before you made an offer - even if you didn't ask.

A few years ago an EA would have got away with not finding out and not saying anything, but the law and the regulations have changed.

(And in any case, the EA would be shooting themselves in the foot, if they encouraged somebody needing a mortgage to offer on an unmortgageable property.)


If you decide to look at other properties, you could ask the EA about ground rent before booking a viewing.

28tsw

I’ve asked the EA just waiting for an answer. I’ve already started a mortgage application for this property and they were keen to tell me I could buy the freehold - I opted not to and do it down the line but guess I might need to now if I find out the terms are onerous 

eddddy

28tsw said:

I’ve asked the EA just waiting for an answer. I’ve already started a mortgage application for this property and they were keen to tell me I could buy the freehold - I opted not to and do it down the line but guess I might need to now if I find out the terms are onerous 

TBH, if you find out that the terms make the property unmortgageable, and the EA is a member of the Property Ombudsman Scheme (most are), I would consider a complaint to the Ombudsman - with a claim for your losses.

EAs can't get away without warning buyers about that kind of stuff any more.

28tsw

eddddy said:

28tsw said:

I’ve asked the EA just waiting for an answer. I’ve already started a mortgage application for this property and they were keen to tell me I could buy the freehold - I opted not to and do it down the line but guess I might need to now if I find out the terms are onerous 

TBH, if you find out that the terms make the property unmortgageable, and the EA is a member of the Property Ombudsman Scheme (most are), I would consider a complaint to the Ombudsman - with a claim for your losses.

EAs can't get away without warning buyers about that kind of stuff any more.

Hoping I have nothing to complain about! Just wait and see. Barratt, based on google, seem less guilty than others so have my fingers crossed 

RelievedSheff

daveyjp said:

If you are buying the house get a copy of the lease. 

Also be aware that even if you buy the freehold it may not release you from leaseholder obligations to pay charges such as upkeep of common areas shared with other residents.

I think you are confusing two different matters here the leasehold has nothing to do with the completely separate issue of estate management charges.

The two are often confused but are not one and the same.

eidand

I also think you are confusing things.
What you probably read about is what is known as fleecehold, as in fake freehold. Ironically, on new builds you seem to have more rights if you are a leaseholder as opposed to being a freeholder.
So , leasehold is one thing.  management charges are another and they will apply regardless if you're leasehold or freehold.

The TP1 form the original buyer gets, lists all covenants that will apply to that property, being leasehold or freehold makes no difference there, that's my understanding anyway. You can probably get those if you download all info from Land Registry. 

Check if the year 2-10 warranty still applies to you, if you buy this property ( NHBC or whatever they have ).

Check what happened to the roads, green spaces, have they been adopted or not. Has the site been completed or is it will work in progress.?
I would not spend anything until all the information is known and I would not rely on EAs, seller. You need to get the proper information on the management charges 

You might also want to check if the management company is now run by residents or is it one of those greedy sharks who exploit you to no end.

28tsw

I’ve not had EA come back yet but I have asked would-be neighbours and ground rent is updated every 15 yrs based on rpi - my research seems to indicate that this is an acceptable term for lenders.