The Help To Buy scheme that has hugely boosted plc house builders share prices – and turned the likes of Persimmon’s Jeff Fairburn and David Jenkinson into multimillionaires – is not available for commonhold properties.
This astonishing revelation comes from small house builder (and former leaseholder) Stewart Moxon, of Hopton Build.
He trying to selling five two-bedroom apartments at Liversedge, near Huddersfield, as commonhold units rather than leasehold, which he regards as a widely abused form of residential tenure.
Now he has been told by the Government’s Help To Buy team, which has doled out £8.3 billion, with more to come – that commonhold properties are ineligible under scheme.
Mr Moxon was informed by the Help To Buy team:
“Apologies for the delay in responding to your query. I was waiting for a response from our Legal department who have now come back to me.
“Our Legal team have reviewed this in depth but unfortunately commonhold properties are not eligible under Help to Buy. For qualification for Help to Buy at present the flats can only be leasehold.”
Commonhold was introduced under the 2002 Commonhold and Leasehold Reform Act.
The Law Commission is to launch a consultation into the form of tenure for flats that holds sway in most of the world outside England and Wales.
It also wants to know why commonhold has had limited take-up.
The answer to that is blindingly obvious: developers and the speculators in residential freeholders are making so much money playing the angles of leasehold.
It may well be the case that Persimmon, Taylor Wimpey, Bellway, Bovis, Redrow etc were unaware that Help To Buy was unavailable on commonhold.
After all, why would they bother to inquire into a form of tenure they have absolutely no intention of accepting unless they are forced to?
Still, curious that another, lesser reason, for commonhold not being taken up is that government discourages it, too.
Stewart Moxon tells LKP:
This weekend I have had to turn away 2 potential homeowners because I have had to deny them the Help to Buy facility.
Hard working honest people wanting to get on the property ladder. Meanwhile the government are continuing to support leasehold apartments and the big builders get richer selling freeholds to investors.
It doesn’t make sense to me why commonhold can’t participate.
I would be appreciative if you are able to enquire with Mr Brokenshire or Homes England to clarify if its just an incompetence e.g. been left off a strategy paper or if there is an unsurmountable technical reason it can’t be offered to commonhold.
I am sure that at the highest level there cannot be support for this position.
I await the release of your report tomorrow and am available if you want clarification. Otherwise I am still diaried for the conference call on Wednesday morning as planned.
Here is someone who is delighted with Help To Buy, and helped himself, too, by spreading leasehold houses around the country: