Financial Issues > Unfair escalating house lease? Unite and challenge house builders
HALO: Houseowners Against Leasehold Oppression demand housebuilders convert all homes sold on leasehold since 2007 to freehold on fair terms.
Is your house new or recently built? Were the terms leasehold, not freehold, as is more usual?
Does the lease contain unfair ground rent clauses? Or has the lease been transferred to a ground rent company under unknown circumstances? Are you being billed for all manner of things you would not expect to be of any concern to the ground rent company?
Since 2007, around 110,000 owners (source: HALO/Make Public) of new leasehold houses in England and Wales, but not the rest of the UK, have found themselves unexpectedly on the wrong end of a new kind of lease. The lease included difficult-to-uncover terms that permitted the ground rent to be increased, or even doubled, at regular 10 or 15 year intervals.
The financial impact on the leaseholder is severe. A ten-year doubler lease starting at £350 pa in 2007, would jump to £700 pa this year, to £1,400 pa by 2027, and to £11,200 pa from the 51st year.
These are five of the most serious problems researched by HALO:
- Why were these houses sold on lease in the first place?
- The people caught out are mainly young home buyers
- On trying to sell a leasehold house that has an escalator lease, buyers’ solicitors warn buyers off
- Original builder’s quote for lease multiplied fourfold and more by ground rent company
- Leaseholders are held to ransom over vexatious charges for even small internal house changes, which has inspired the name of this campaign
What is happening?
At present there is pressure to change the law in Parliament to ensure new houses are in future built freehold. a 3,000 strong response to Secretary of State for Communities and Local Government Sajid Javid's consultation closed on 19th September 2017, and next steps are eagerly awaited.
However, it is unclear whether any law changes that are made will retrospectively cover the existing 110,000 leasehold houses. HALO: believes that pursuing legal action may result in alleviation of the problem to an extent, but doesn't stop the leases increasing. However this should be encouraged. In particular, this does nothing to fix the rip-off fees ground rent companies charge for house improvements such as repainting a door, adding a conservatory or even, in one case, seeking permission to have pets.
Who carries primary responsibility for the escalator leasehold scandal?
Since 2007, the UK's principal builders, Taylor Wimpey, Persimmon, Barratt, Redrow, Countryside, Bellway, and Bovis have all provided conventional houses, but created with them the toxic escalator leases that came to the attention of Parliament and the press in Summer 2017. In very many cases, when the houses were built, the builder secretly transferred the leases to ground rent companies rather than offer them to the leaseholders evenwhen prior agreement to do so was documented.
We argue that the builders are 100% responsible for the scandal. The builders' designed and introduced the toxic house lease contracts. This moral responsibility has not gone away with their selling leases en masse to ground rent companies, in the same way that the tobacco companies could not ultimately evade being sued for their toxic products, or European diesel car makers could not avoid compensating their customers after being found out over rogue emissions software disregardless of the age of the vehicle.
We claim the UK's larger builders are guilty of an abuse of public trust. This is most certainly not reduced by the legal niceties of trying to sell on their responsibilities, or by hoping to escape via the six-year contract limitations law. Suing conveyancers alleviates, but doesn't solve the problem, and attempts to get the lease terms change seem to be partially successful as the ground rent companies - might - relax the most onerous terms. But the leaseholder is still stuck with a lease and an array of large unwarranted charges whenever they seek to make even small changes to their home.
For the 110,000 affected leasehold campaigners, this is our campaign to make the major builders own the responsibility of puttng the situation right by taking back all 110,000 leases, and converting them to freehold at either a zero cost, or at a freehold purchase price as originally estimated by them.
Come and join us here
Become a powerful voice to make these seven steps happen:
- Build the membership as quickly as possible to become a substantial force
- Get building company CEOs to attend a Select Committee to answer questions raised by campaigners. Circulate the results
- Organise effective demos at new-build sites originated by housebuilders who issued vexatious leases, whether or not the sites are leasehold or freehold (based on the rationale: if this site's freehold, why isn't ours?)
- Raise the issue of the left-behinds (those leaseholders where contracts were sold more than six years ago from today), and demand compensation
- Encourage regular writing to MPs to keep the scandal front of mind. This works! Particularly useful letters will include the difficulties of selling affected houses, ground rent contract examples, and outrageous ground rent company demands over trivial matters.
- Call for the APPG for leasehold reform to meet regularly and keep campaigners updated regarding legal moves, and press for all changes in leasehold law applying to house leases to be retrospective.
- Have an effective newspaper communication programme to bring all developments to the mainstream press as they happen.
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Join us now, and make sure your voice is counted
Sign our Petition below at:
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Chris Clark, HALO - Houseowners Against Leasehold Oppression and Make Public
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