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Leasehold reform proposals could save homeowners £1,000s - MSE News
MSE_Chris_D
Posts: 31 MSE Staff
Millions of homeowners looking to extend their lease or purchase their freehold could save £1,000s under new proposals published by the Law Commission, though any changes are likely to be a long way off...
Read the full story:
'Leasehold reform proposals could save homeowners £1,000s'
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'Leasehold reform proposals could save homeowners £1,000s'
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Comments
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Most Leaseholders will find this report extremely disappointing , the only possible change is likely to be marriage or hope values and the gist of the requested reforms appear stifled because Freeholders clearly have a stronger human rights case to make money on the back of other people than Leaseholders do to own their property unencumbered.
For existing Leasholders this does little to help them financially other than to suggest an easier way to calculate the costs not reduce the costs so it is certainly not the holy grail to ease Leasehold problems.
What about the people who are stuck in limbo now and cant sell their properties they don't have time to wait possibly years for resolution. Does the government have social housing on standby for all those whose lease is due to default / expire ?0 -
I purchased house new in 2000 Bellway had purchase lease 5 years previously in 1995, not good! I thought I had 82 years left on lease when in fact it's 78 years!
With all the extra costs involved, probably only option now is through courts As doesn’t look like it’s going to get any better for leaseholders any time soon! Very disappointed in Law Commissions report!0 -
I am in a shared ownership property with a 67 year lease. I am facing lease extension fees of £16k to be able to sell my property. This includes paying a permission fee to my housing association freeholder and legal costs on both sides. I had to pay £600 just for the lease value survey. In SO, you have to pay the premium based on the full property value regardless of the % share you own which is completely unfair. If you are in SO and haven’t staircased to 100% you are not legally entitled to a lease extension and cannot go down the formal route which means the fees are non negotiable. Unlucky for me my SO is such I can never staircase so I am trapped. And many in SO will never be able to afford to staircase. I was never advised of this by my solicitor or the HA when I bought 11 years ago. And many are still buying into shared ownership now without being advised that the lease will need extending before it drops below 80 years. Reform needs to happen. The law commission report is very disappointing for leaseholders and in particular SO is barely mentioned. All these new build SOs that are being promoted are going to face these issues in years to come if nothing is done. All of us in older SOs built in the 80s are starting to see the true reality now as our leases have ran down. I would advise anyone in a Leasehold flat/house/SO to join look up and join the National Leasehold Campaign ( NLC ). They have been a huge source of info and support to me during a very stressful time.0
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When you buy a new build Leasehold house the true ownership is sold to a speculator for £2000 or probably much less, a price and opportunity never offered to you and not available.
That's right, a 3rd party actually owns the home you think you just bought. The Title is sold behind your back. It looks like a fraud. It is a fraud but allowed by law. The law says it is ok to cheat Leasehold house buyers.
You then spend the rest of your life paying for someone else's house and even pay rent (groundrent). In flats but also on some Estates, you pay other additional bills on top of your mortgage because he expects you to pay for the maintenance and upkeep of the house he owns and you are paying for. The true owner does not expect to even do maintenance.
What does the new householder get out of it? Actually just a secure tenancy! As secure as your job, as you will lose your home if you can't pay your debts.
Why would anyone buy into such a burden you might say. Answer: because they don't know what they are buying into. They think they are buying a home. The flat or house is "for sale", the first step into the fraud. The "Leasehold Interest" is for sale, not the house. People think groundrent is traditional and just for the land but in fact you don't own the house you borrowed a small fortune to buy.
At no point does any professional state in plain English that you have bought a long term tenancy, you are not a home owner and you will have huge bills to pay a few years down the line.
The system is a legacy of Feudalism making billions for a few companies and this is the system our Law Commission wants to keep and thinks is fair. No other country except corrupt little England has it. Everywhere else in Europe they have freehold and commonhold.0 -
I was never advised of this by my solicitor or the HA when I bought 11 years ago.
Complain and threaten to sue your solicitor.RICHARD WEBSTER
As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.0 -
Unfortunely the feudal leasehold system persists in England and Wales having been abolished in Scotland. Abolition is the only way to reform.0
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Leasehold home buyers, shared ownership leasehold buyers, and those buying a newer freehold home with charges and fees have inadequate protection at point of sale. You have more consumer protection buying a fridge or TV compared to buying a house or flat.
Leases are complex documents, written in such a way that consumers do not understand them without the help of a good solicitor. Some new build houses have been mis-sold as leasehold with developers deceiving buyers, and the developers recommended solicitor failing to warn of onerous terms in the lease.
So if you are thinking of buying a leasehold property do thorough research.
You are buying a long tenancy with a declining lease, you do not own the bricks and mortar. Your freeholder does, who may be a remote entity based offshore. They will care little for you or your circumstances other than making as much money as possible from you and your property. They may appoint their own associate managing agent, who you may not be able to remove in some circumstances, so the service charge will increase rapidly.
The freeholder will arrange the building insurance and make a nice profit from you in doing so. You cannot arrange your own cheaper insurance.
Know the ground rent and increasing terms, permission fees, the service charge and how quickly it has increased.
A short lease of less than 80 years will probably need extending at great expense so you will be able to re-sell your property.
Know the names of your freeholder and managing agent before buying.
Be aware that the freehold of your home and the building itself could be owned by remote ground rent speculators who only want to make a good living from you. They have the ultimate power of forfeiture if you owe them a small debt. That means you could lose your home without any compensation.
Do not buy into shared ownership leasehold, you will almost certainly never get anywhere near owning your own home.
Finally be aware that the corrupt long leasehold system is confined to England and Wales, for the obvious reason that vested interests make a good living from it. Just about everywhere else use Commonhold type systems for communal living, where residents have much more control over their living costs.0 -
Some of these posts seem to be in a remarkably similar style! Somebody is obviously pretty upset about this.No reliance should be placed on the above! Absolutely none, do you hear?0
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Some of these posts seem to be in a remarkably similar style! Somebody is obviously pretty upset about this.
Would it help throw in a bit of rhyming slang or spelling / grammar mistakes to help change styles. Do not diminish the raw anger about this issue with such comments. This is people's whole financial security at stake here and they were pinning their hopes on this report and on the surface it seems to offer no help / hope at all except a calulator so we know what the costs are.0 -
It is a scandal that 23% of leaseholders were not told the difference between leasehold and freehold and the solicitors who didn't advise this for leasehold houses should be made to buy the freeholds. These solicitors should be disciplined.
77% of leaseholders who were told the difference will receive a windfall which is a kick in the teeth for those who can't afford their own home and for those who have bought a freehold under the old method.or who have simply bought a freehold home. I'm not sure why somebody who knew it was a lease and had to pay a ground rent should benefit by thousands of pounds.
There was also some mis-selling where people were told they could buy the freehold at a certain price and once these people have bought the freehold then those that mis-sold need to make up the difference.
Fines should be dished out for any mis-selling
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