Members of the National Leasehold Campaign Facebook group posed for photographs behind the iron bars of a prison cell to warn off would-be buyers of leasehold homes at the First Time Buyers show in Manchester on Saturday October 7.
The demonstration aimed to increase awareness of the pitfalls of leasehold tenure to first time buyers.
Thousands of families have become PRISONERS in their own homes after being mis-sold leasehold properties with onerous ground rents and permission fees. Many of these homes were bought through the government sanctioned Help To Buy Scheme, which has fuelled housebuilders profits and led to massive remuneration packages for CEOs.
Taxpayers are supposedly helping a new generation of homeowners. In fact, they are creating a tradable investment asset – the freehold – which is invariably purchased by anonymous investors who hide their beneficial ownership behind nominee directors and are often based offshore.
Is this really a good use of public funds?
Katie Kendrick of the National Leasehold Campaign said:
“Our demonstration aims to show the dawn of the new reality facing thousands of families in England and Wales, and to highlight the terrible consequences of the recent leasehold abuses: in particular how young families and first-time buyers have become trapped as prisoners in their own homes by oppressive leasehold contracts designed by greedy developers and freeholders. The Government recently announced an additional £10b for Help to Buy.
“We want to make sure that this money is not used to fund more leasehold homes. However, this is not only about ground rents – we need to alert unwary first-time buyers about leasehold in general and recent abuses that have blighted thousands of ordinary families, many who bought using the government’s Help To Buy Scheme.
“There are millions of victims, most of whom don’t even realise they are part of this scandal yet.
“People buy a home thinking they own it, yet in the eyes of the law they are only a tenant.
“Leasehold tenure needs to be assigned to the history books and abolished once and for all – for both flats and houses.”
Major developers including Taylor Wimpey, Bellway, Redrow and Persimmon have been selling houses as leasehold, and selling the freeholds on to third party investment companies without the homeowner’s knowledge, as an additional income stream.
In many cases, those homeowners were promised they could buy their freehold for a nominal sum after two years, only to find that they had already been sold on with the new freeholders demanding extortionate amounts that can exceed £30,000 to sell the freehold back to homeowners.
In anticipation of the recent Government consultation that is expected to ban the sale of leasehold new build homes, developers are already moving to advertising properties as freehold, but keeping many of the covenants and permission fees typically associated with leasehold properties, something the National Leasehold Campaign is calling “fleecehold”.
Campaigners handed our leaflets to First Time Buyers.
Taylor Wimpey has recently set aside £130m to deal with the problem, with one freeholder offering to change some doubling ground rents to RPI (retail price index). But sources indicate this is simply a PR exercise to keep the status quo.
Taylor Wimpey leaseholders feeling pushed into a corner.
Jo Darbyshire, of the National Leasehold Campaign, states:
“Freeholders and developers have gone one step too far – their increasing greed has derailed the gravy train and they want it back on track by tossing some crumbs to leaseholders.
“Ground rents are only part of the problem – management fees, permission fees, unfair leasehold tribunal system and a range of other charges.
“The system is rotten to the core.
“I hope that the outcome of the Government’s consultation on tackling unfair practices in the leasehold market will bring a ban on the sale of leasehold and “fleecehold” new homes.
“I want to see a full review of the mis-selling of leasehold homes, similar to those that we’ve seen for pensions, PPI and endowment mortgage mis-selling and full redress paid to those of us that have been caught up in this nightmare.”
Campaigners came together in Manchester to warn First Time Buyers.
Redrow, one of the developers at the heart of the scandal, recently posted record profits of £430m – despite a downturn in the housing economy – while Persimmon boss Jeff Fairburn was recently handed millions of shares worth £112m as a bonus.
An estimated 4.2 million people are leaseholders in England and Wales. Scotland banned leasehold in 2000 with the Abolition of Feudal Tenure Act.
Please sign our petition to abolish leasehold and introduce strict regulation for residential managing agents:
Sign the Petition
Theresa May MP: ABOLISH LEASEHOLD & STRICT REGULATION FOR RESIDENTIAL MANAGING AGENTS BE INTRODUCED
Well done Katie and all who support you. I think your protesting and petition is going to affect real change. Hoorah for Katie and the NLC supporters – Hip hip Hoorah for LKP.
APATHY IS A CRIME
SILENCE IS A CRIME
SIGN this petition if you are a leaseholder – NO if’s NO buts and NO maybes.
Absolutely brilliant demo in an ideal spot for broadcasting information to the many would be purchasers who know nothing about the scams these builders have introduced.
Regrettably one can only assume the government supports these money making scams, mostly done with tax payers money re the wonderful Help To Buy Scheme (yes, buy a lease, but NOT a home)’
The HTBS is actually a Help To Sell Scheme (helps the builder).
I say this because we have yet to see the government do anything MEANINGFUL to stop this disgrace.
The HTBS is riddled with faults anyway – it should be for first time buyers and those on low incomes only, not for anyone just buying a brand new property after selling their half million pound old one and then using tax payers money towards buying their new build.
I can’t think what sort of regulation would be enough for residential managing agents,
Solicitors are supposed to adhere to strict anti money laundering rules, but who ensures this is adhered to? How does the SRA know if property solicitors are not money laundering for themselves or clients ? Or are we supposed to just trust them to be beyond reproach?
” the freehold – is invariably purchased by anonymous investors, who hide their beneficial ownership behind nominee directors”
this is key and more wide spread than people imagine. Paying taxes is just for the poor,, the well connected invest in freehold and know how to hide their identity. They just sit back and get wealthier whilst their flock of leaseholders provide for them. It truly is the many working for the few.
And if that wasn’t enough the general taxpayer is now having to pay for the help to buy fiasco. Young people are desperate, even with good jobs, they have no chance of buying even an one bedroom flat in London. – but this scheme is a scam – is not really helping them.
It should be mandatory for freehold, to publish independently audited accounts, on line for all to see. Surely the housing minister would welcome transparency. I would love to see what really happened to money from my service charges over the years…and what regime in what country my ground goes to support..
I believe that the Regulation of Managing Agents should include Introducing proper forms of legal discipline and serious financial / Custodial penalties for Insurance Fraud,other forms of theft , harassment, Intimidation , Charging on false Invoices , persecution of leaseholders, and whatever other gangster tactics they apply. to shaft leaseholders and which are routine and commonplace amongst the MAJORITY of Managing Agents, Hands up those who disagree!
The balance is very much tilted in favour of the Freeholders and their ‘ Agents’. It is bandit country out there in residential property management and it has to change.
Why can’t there be a system similar to ABTA or ATOL? That seems to work well? Managing Agents of a certain size should be legally bonded.
Mr Epstein. ALL Managing Agents must be Strictly Regulated regardless of size. They cannot be trusted to regulate themselves – this has been proven!
Hell, If these Managing agents don’t relish the fact that they will be compelled to act honestly and with integrity, then they can always go off and try a different profession e.g. – Medicine – physics concert pianist? Errr NO to thick and venal.In reality,most would end up nicked and in prison or working as bouncers in dodgy nightclubs- and that’s just the women! STRICT REGULATION FOR ALL ‘MANAGING AGENTS’. Their Harvey Weinstein moment has come…………Need I say more?
Don’t disagree, Kim. to clarify my comment, I don’t want to penalise those managing agents that may be owner/occupiers or Right To Manage companies managing their own block.
Mr E I honestly believe RTM or Owner occupiers Managing Agents will not see strict regulation as being penalised. Of course if they try and cheat their fellow leaseholders ( Tenants/ Serfs)! then they should have their collar felt.
Oohps meant – too thick – and comma between physics and concert pianist. – ( Anal or what)
Leaseholds must be replaced by Commonhold. Residential Managemen Group (RMG) is a disgraceful company. They don’t manage, their charges are extortionate and they never answer you if you query a charge. I had a meeting with Paul Golds our PM last February myself and another resident had a list of questions re shody workmanship and overcharging. Our questions were not answered but to add insult to injury he told us at least twice that RMG paid him well and that he had plenty of experience of property management. Unbelievable, leaseholders know very well that the uneducated staff they employ are cloned to extort as much money as they can, harass and intimidate tentants, be obstructive when asked questions. These people have no skills or education whatsoever. Their correspondence is badly written – they love to send meaningless letters to the whole estate rather than to the individuals or properties concerned – another money making scam as they charge about £25.00 per letter. Customer services is an absolute shambles they haven’t a clue what they are doing, rude, unhelpful and certainly try to avoid sending confirmation of payments made – yet another scam. The google reviews on RMG make interesting reading, especially the uneducated robotic replies from Darren Alexander, Customer Services.
Residential Managing agents MUST BE STRICTLY REGULATED TO STOP ABUSE, CORRUPTION AND FRAUD.
Thousands of people are trapped because they can’t sell their properties due to high ground rents charged by freehold investors and unscrupulous self serving management companies.
Help to Buy Scheme has been abused by builders to line their own pockets with tax payers money. How could the government have been so gullible to allow this to happen?
Penny, government is not gullible, government is part of the conspiracy against ordinary people. I could attach many adjectives to those in government, and those in parliament, “gullible” is not one of them.
Penny Atkinson I hear you. STRICT REGULATION OF MANAGING AGENTS is the only way forward. I urge you to sign and share the petition. These bullies need to be brought to heel.
The Rachmanist era Is obsolete and must remain so.
I signed the petition last week. I think many leaseholders still don’t understand what this is all about – we should have thousands of signatures by now.
Penny I totally agree with you, but in addition I believe there are too many apathetic leaseholders out there who just ‘ can’t be bothered’ – ” Too busy” – ” Life’s too short” yadda yadda.
I do know that the Indomitable Katie Kendrick has set up a Facebook ‘ page’ and Is sharing it I believe with Mumsnet ‘ where I am sure there are many first time buyers starting their family- ‘ Citizens advice bureau ” et al.
I am doing my bit. In sharing the petition with everyone I know , don’t know, love, hate, folks I meet in the park whilst walking my dog. We have just got to keep on keeping on!
APATHY IS A CRIME , and meat and drink to the operators In the residential property mangement racket.
LEASEHOLDERS – “Rise like Lions after slumber
In unvanquishable number -shake your chains to earth like dew
Which In sleep had fallen on you.
We are many- they ( Freeholders) are few.
We must fight to abolish leasehold and Regulate Managing Agents.
This is all very worrying. Am I about to fall into a cesspit?
I have the option of buying an apartment from Taylor Woodrow. Current leasehold charge for this year is reasonably low but will double after 30 years and continue to double each further 30 years until the lease is up, if not extended. What is stopping them selling the freehold to another party who then varies the conditions? Or should I be more worried about the service charge which is around £600 for this year?
Ideally I’d stop right now if the alarm bells start to ring, before I tender a holding deposit.