Salvation, in the shape of new legislation, may be in store for up to 100,000 leaseholders held hostage by unscrupulous landlords, revealed the Daily Mail recently.
The prospect of changes in the law followed a highly critical report by the Housing Committee of the House of Commons about the plight of leaseholders unable to sell their homes because of the high – and forever escalating – ground rents and fees charged by their landlords.
The sale of newly built homes under lease conditions such as these has already been banned.
The 100,000 or so homes still concerned remain in the ownership of developers or landlords who have attached such onerous charges on their leaseholders that the properties are effectively impossible to sell to new purchasers. Following the House of Commons’ report, MPs are calling for a change in the law to help the current owners escape the constraints imposed on them by the terms of their leases – allowing them to make the possibility of selling their homes as and when they choose.
Profiteering on the back of such punitive lease agreements has been likened by some commentators to the “PPI of the housing industry – harking back to the mis-selling of Payment Protection Insurance that scandalised the first decade of this millennium (a scandal that is, even now, continuing to cost banks around £330 million every month, says the Financial Conduct Authority).
We explored the similarities in the mis-selling of leases on homes and of PPI in an article on the 10th of October 2018.