Should the Government act NOW to reform leasehold? LEASEHOLD SCANDAL

Chavril

penners324 said:

Looks like a lot of trolls just mouthing off on this thread.
I had a leasehold flat, built by Taylor Wimpey. Cost me £1.5k in solicitors fees to amend the lease to RPI increases.

How on earth someone has to pay £50k to fix I've no idea.

Well it's true and that is our situation, £53k, our ground rent doubles every 10years and no issues were flagged at all at the time of purchase. 

Comms69

No. The govt shouldn't get involved in nonsense where people cant read a contract - that's their problem. 

eddddy

Chavril said:

penners324 said:

Looks like a lot of trolls just mouthing off on this thread.
I had a leasehold flat, built by Taylor Wimpey. Cost me £1.5k in solicitors fees to amend the lease to RPI increases.

How on earth someone has to pay £50k to fix I've no idea.

Well it's true and that is our situation, £53k, our ground rent doubles every 10years and no issues were flagged at all at the time of purchase. 

I'm not sure that's a problem with leasehold, as such - the problem is that nobody explained to you what you were buying, so you couldn't make an informed decision.

The developer and your solicitor should have clearing said something like...
"You're paying (say) £300k today, and you'll need to pay another £53k in a few years" with an explanation of why.

Then you could have decided whether the property was worth £353k, and whether you'd be able to save-up or borrow a further £53k in a few years time, etc.

Salemicus

eddddy said:
I'm not sure that's a problem with leasehold, as such - the problem is that nobody explained to you what you were buying, so you couldn't make an informed decision.

Right, and could just as easily have occurred on a freehold property - for example, if there was an overage, restrictive covenants, burdensome easements, etc etc etc. Just yesterday there was someone asking for help suing their solicitor/surveyor because no-one explained to her that her non-standard construction house wasn't mortgageable.

If you sign a contract without understanding it, then I have some sympathy for you, but it's limited. If you did understand it, but were hoping you could make money off someone else buying it from you, then my sympathy is even less. And indeed, most of the complaints are about difficulties selling on at a good price, not that the ground rent charges are unaffordable per se. For example, @Chavril could clearly afford the ground rent charges if they could pay them all up front - the reason for eliminating them via lease extension is to make the property mortgageable. The comparison to slavery is ridiculous and offensive.

By default, you are bound by the terms of the contracts and deeds you sign. There may be occasions when the government should step in to release people from onerous contracts, but it's rare. And think about the flip-side. You would have got your leasehold much cheaper if you hadn't agreed to pay ground-rent. If for some reason your leasehold contract is so onerous the government should step in to alter the terms, you should have to compensate the freeholder for their loss.

Final point - "some leaseholds are onerous, so leasehold should be abolished" is a complete non sequitur. We can address any issues without throwing out the baby with the bathwater. If I want to sign up to a lease, and I don't consider it enslaving myself (because I'm not a crazy person), why should the government prevent me?

simondv

Several attempts have been made to reform / abolish leashold since the late 1800s. Lloyd George was talking about it in early 1900s. Long leasehold with a private freeholder has no place in a civilised society for houses and flats. Scotland got rid of it, Australia about 1960. Everywhere else manages with Commonhold type systems for flats, not perfect, but far better than leasehold. Home buyers do not want to pay unnecessary ground rents, permission fees, lease extension costs, commissions, and put up with an expensive freeholder appointed managing agent.
The only people complaining about possible abolition are the unnecessary  fee extracting entities embedded in peoples homes.

theartfullodger

Higher priority is surely sort out Covid having made such a mess of it and killed (through stupidity and neglect) so many.

Get that sorted 1st.

simondv

md258 said:

I lived in a leasehold flat (one of 40) and i believe leasehold was definitely the right method of ownership. I didn't have to negotiate with 39 other owners about getting repairs/enhancements done and although I didn't agree that they all needed doing, overall it was worth it.

Leasehold houses are a different matter but IMO there is nothing wrong with leasehold flats as long as you understand what you are buying and will have to pay for.

The other 39 leaseholders might like to decide between them who to employ to service the building (even if you don't) and not have to pay unnecessary ground rents, permission fees or lease extension costs.

Salemicus

Leasehold is rare in the US, but it does exist, including in such obscure places as New York and Florida. It also exists in Canada. If you lie about easily-checked things like this, why should we take you seriously on anything else?

spoovy

Slavery is very much alive in many parts of the world today including in the UK, and it is ridiculous to suggest that people who bought something without understanding the hidden costs are in any way in a comparable situation to slaves.  You may have been stung financially, well that's a shame for you, learn your lesson and move on.   

Thrugelmir

With the HoC not sitting for a while. Must be a backlog of legislation sitting awaiting debate. Not helped by the timing of the General Election last year.