Shocking leasehold report:
The Leasehold Knowledge Partnership today publishes a report demonstrating that there are 5.37 million leasehold properties in England and Wales (end of 2013).
The government repeatedly uses the figure 2.5 million.
The figures show that leasehold is 21.6 per cent of the total housing stock by number of properties.
The Leasehold Knowledge Partnership’s analysis has been accepted by the British Property Federation and the Council of Mortgage Lenders in recent submissions to government regarding the Flood Re insurance scheme.
(Leasehold flats are excluded from the scheme.)
Approximately 60 per cent of leasehold is privately owned. That is 3.25-3.5 million properties.
Another 40 per cent is rented out through councils and other social landlords, totalling 1.8-1.9 million units.
Within the privately owned sector more than 50 per cent is then sublet to the private rental market.
London has the largest proportion of leasehold properties representing 50 per cent of the capital’s housing stock by number of properties, and a third of all leasehold properties in England and Wales.
These figures are based on datasets in the 2011 Census and the figures from the National House-Building Council (NHBC) of January 31 2014.
They contrast with the figures from government and public bodies that have repeated that there are about 2.5 million leasehold properties in England.
The London Assembly reported (“Highly Charged, March 2012) that there were 500,000 leasehold properties, but the correct figure is three times as much.
Almost ALL new residential property in London is leasehold.
Retirement housing accounts for 500,000 leasehold units, of which 100,000 are privately owned, the remainder are rented.
Why this matters
Residential leasehold is a sector rife with scandals. Some behaviour is criminal, according to Sir Peter Bottomley.
Much dubious, and possibly unlawful, activity is assisted by lawyers, accountants, auditors and surveyors.
Bottomley predicts ruined professional careers and possibly prosecutions, when scandals in leasehold come to light.
These are the routine activities reported by the Leasehold Knowledge Partnership and Carlex:
- – Opportunist investors scouring the auctions for freehold assets that are then systematically monetised. For example, by a succession of unnecessary major works.
- – Insurance on blocks of flats is bought by freeholders, but paid for by leaseholders, who have no right to know the scale of the commissions involved (they can exceed 50%).
- – The opaque unregulated property management industry is rife with padded bills and extras. Commissions are routinely paid to property managers to spend other people’s money.
- – Common parts to a block, such as house managers’ flats, are alienated with a separate lease and sold off. This is unlawful, and possibly criminal.
- – Freeholders only invest, perhaps, five per cent in a building compared with the capital value of all the leaseholders’ flats, yet have tremendous powers.
- – Most sickening exploitative behaviour is seen in retirement leasehold against vulnerable pensioners who cannot fight back.
Examples of these injustices can be provided to media.