But …
Landmark Investments claims it has saved leaseholders over £1m by telling them they do not need to engage their own legal advisers in dealing with freehold purchases
It tells MP that its practices have made enfranchisement ‘cheaper’, ‘quicker’ and ‘easier’.
LKP are ‘pathological liars’ over leasehold abuses, says Landmark’s Mark Hawthornthwaite
It is ‘Machiavellian’ in exploiting leaseholders to further its campaign, and has a ‘vendetta’ against Landmark Investments
It has a ‘track record of exaggerating and spreading misinformation’

The freehold of a house built by Elan Homes more than doubled in price from £7,500 to £15,900 four months after being sold on to ground rent speculators Landmark Investments.
The increase happened last December – more than two years after the scandal of leasehold houses came to national attention.
The leaseholders, Ian Rice and his wife, Deborah, who own an Elan Homes leasehold house at Borromeo Close in Liverpool, were offered the price of £7,500 for the freehold in September 2018 by Elan Homes.
Elan Homes CEO John Kendrick has confirmed to LKP that the price of 30-times annual ground rent of £250 would have been correct: ie £7,500. The ground rent is linked to RPI every ten years and the lease length is 999 years.
But in December 2018, Elan Homes sold the freehold to Bolton-based ground rent fund Landmark Investments.

When the Rices inquired about buying the freehold in January this year – for which they paid £50 to Landmark Investments – they were told the price was £15,900.
That amounts to more than 63 times annual ground rent.
The higher figure is only valid for 28 days – after which one assumes another £50 may be required – and a further £540 would need to pay for Landmark Investments’ legal fees.
Ian Rice told LKP:
“In my opinion, Elan Homes are largely responsible for this! They knew I requested the purchase and knew I was getting the finance together, yet they deliberately sold the freehold on to these monetisers.”
Elan Homes emphasises that its homes are available to purchase with the taxpayer funded Help To Buy scheme: https://www.elan-homes.co.uk/buying-with-elan/
LKP raised the Rices’ case with Mark Hawthorn / Hawthornthwaite (he uses both names in his businesses), the chief executive of Landmark Investments, and John Kendrick, of Elan Homes.
The correspondence was marked ‘For Publication’ and copied to local Labour MP for Liverpool Riverside Dame Louise Ellman and Communities Secretary James Brokenshire, as well as LKP’s patron MPs.
While Mr Kendrick confirmed the details of the offer to the Rices, Mr Hawthorn / Hawthornthwaite responded less temperately in a series of emails.

Having previously termed LKP “pathological liars” on Twitter, Mr Hawthorn / Hawthornthwaite doubted there was any evidence for the Rices’ complaint and referenced LKP’s “track record of exaggerating and spreading misinformation”.
This article has appeared in the Liverpool Echo since the piece appeared on LKP’s website:
Builder says his dream new home has ruined his life
A builder has said that he has experienced two years of ‘stress and misery’ since he moved into a new build house in south Liverpool. Ian Rice paid £270,000 for the three-bedroom detached property in Borromeo Close on the Aigburth Grange estate two years ago.
He added:
“Suffice to say should you publish anything incorrect we will take action to defend our good name.”
After evidence from both Mr Kendrick, of Elan Homes, and the correspondence from Landmark Investments addressing the offer to the Rices, Mr Hawthorn / Hawthornthwaite responded more fully.
He acknowledged:
“We weren’t informed that Elan had offered to residents. The price hasn’t doubled, they were offered a large discount by Elan which were were unaware of and unable to honour.”
He subsequently sent longer statements both to Sebastian O’Kelly, CEO of LKP, and Dame Louise Ellman. (In full, below.)
Mr Hawthorn / Hawthornthwaite told Sebastian O’Kelly on April 8 that the Rices had accepted the £15,900 offer from Landmark Investments, but that their email had gone into the spam folder.
“It may simply be that, like many leaseholders, they were content with the position until they became an unwitting proxy in your vendetta against us …”
Mr Hawthorn / Hawthornthwaite added that the developer had offered the Rices a discount on the freehold as “a gesture of goodwill with them being customers”.
“If we were to sell the asset we would need to replace the income with something similar. Whilst there is no direct comparable, the closest option would be a long term Government bond which would require a sale price of around £20/22,000 to allow sufficient funds to replace our income stream … “
Mr Hawthorn / Hawthornthwaite also addressed the issue of Landmark Investments advising leaseholders that they do not need to engage a lawyer in dealing with freehold purchases.
He claimed this had save leaseholders over £1 million in legal fees over 10 years.
“You are correct in that we advise residents that there is no requirement for them to engage their own lawyer.
“It is important to determine that we do not advise them not to use a lawyer, it is entirely at their discretion.
“We have done over 1,000 of these transactions over the last decade or so and the majority opt not to use a lawyer.
“We have had no issues at all and leaseholders will have collectively saved over £1,000,000. We have been committed to making it cheaper, easier and quicker to acquire the freehold, as per the Governments intent, throughout our almost 20 year history.”
Mr Hawthorn / Hawthornthwaite also responded to Dame Louise Ellman:
“We occasionally experience interactions with residents who have been misinformed and wound up by a tiny band of leasehold campaigners who use these innocent homeowners as a proxy in their campaign.
“As a professional freeholder, signed up to the recent Government backed Freeholder Pledge, we abhor this Machiavellian tactic as it creates unnecessary distress for residents with no recourse to the campaigners own homes (which are often freehold).”
He explained that the £50 that Landmark Investments charges to deal with freehold purchase inquiries “is simply to ensure that the enquiries we get are serious”. He claimed it was returned on completion of the purchase.
Ian Rice said:
“We are appalled to be caught up in these games. We have a legal right to buy the freehold and will now enfranchise through the statutory formal process. I am so furious about this that I do not even care if it does not, in the end, save us money.”
The Rices have engaged the services of Louie Burns, of Leasehold Solutions, to purchase the freehold from Landmark Investments.
Mark Hawthorn / Hawthornthwaite, of Landmark Investments, to Sebastian O’Kelly, of LKP. April 8 2019Hi Sebastien [sic],
I’ve had a chance to review this now and am able to offer you a response. As I may have mentioned I am a leaseholder in my own home and also across a number of other investments we own. I have no issue with the position and play my part, I appreciate you live in a multi million pound freehold property so enjoy title absolute
I’m unsure if you are aware but the Rices accepted our price to acquire the freehold. Unfortunately they sent the acceptance email in a format which was diverted to our spam filter, we have only unearthed the email after doing an audit of communication to date. It may simply be that, like many leaseholders, they were content with the position until they became an unwitting proxy in your vendetta against us. I have no personal issue with you but, as you are well aware, I will not stand idly by whilst you spread misinformation and sacrifice innocent homeowners to further your campaign – it is just wrong. Ironically I note that you are inclined to leave alone freeholders who refuse to engage with you yet regularly launch flaccid attacks upon us despite the fact we are always open to sensible debate
We were unaware of the developer offering the Rices the option to buy and you have yet to provide any evidence, despite indicating you have it. I’m not going to frustrate you by requiring you provide something you clearly don’t have and am much more inclined to take a pragmatic approach and answer your questions
The developer has offered the Rices a discount, I would expect as a gesture of goodwill with them being customers coupled with the fact that the developer has no base cost for the asset so can afford to. If we were to sell the asset we would need to replace the income with something similar. Whilst there is no direct comparable the closest option would be a long term Government bond which would require a sale price of around £20/22,000 to allow sufficient funds to replace our income stream. Of course we have not requested this figure, although many would and investment logic would support, as we are reasonable people
The £50 valuation fee, which includes £10 of VAT, is for our time in reviewing the lease and other contributing factors to determine a price. There is no margin in this work but it is necessary if we want residents to avoid having to go down the much more expensive formal route. In addition the fee is discounted from the purchase price so is effectively free should the residents proceed
You are correct in that we advise residents that there is no requirement for them to engage their own lawyer. It is important to determine that we do not advise them not to use a lawyer, it is entirely at their discretion. We have done over 1,000 of these transactions over the last decade or so and the majority opt not to use a lawyer. We have had no issues at all and leaseholders will have collectively saved over £1,000,000. We have been committed to making it cheaper, easier and quicker to acquire the freehold, as per the Governments intent, throughout our almost 20 year history
I trust this settles the matter
Regards,
Mark Hawthorn
Mark Hawthorn / Hawthornthwaite, of Landmark Investments to Dame Louise Ellman MP. April 8 2019Dear Dame Louise,
I hope you had a pleasant weekend are enjoying the good weather we have today
I’m sure you are very busy so will try and keep this response succinct, although I’d be happy to go into further detail should you require. You are also more than welcome to visit our offices, see our operation and hopefully learn a little more about all the good work we do which by design goes unnoticed
1. We were unaware until late last week that the residents on this site had been offered their freeholds at a discount by the original developer. Speaking from experience the developer is likely to have done this for two reasons, firstly goodwill – as the leaseholder is their original customer – and secondly because there is no base cost to the developer, unlike an investor
2. We charge a very small fee of £50, which includes £10 of VAT, for the work involved in reviewing a lease and providing a price to purchase. We do not seek to make a profit from this it is simply to ensure that the enquiries we get are serious. In addition the fee is discounted from the price so if the resident proceeds the valuation is effectively free. An alternative approach would be for us to insist that any applications proceed down the formal route which would involve third party professionals whose fees would be many times more than ours. I also understand our fee is well below the fee which many other freeholders would charge
3. We have conducted an audit of all communications with Mr & Mrs Rice (the Rices) which has unearthed an email which was diverted to our spam box. The reason this happened is because the entire content was written in the subject line and the email itself was blank. This email was the last communication we had from the Rices which was to indicate that they wished to proceed but required some additional time. We would have been more than happy to extend this courtesy had the email been received which is an error on their side rather than ours. I do find it unusual that the Rices were minded to proceed at the price but have since been somehow influenced into taking issue. We occasionally experience interactions with residents who have been misinformed and wound up by a tiny band of leasehold campaigners who use these innocent homeowners as a proxy in their campaign. As a professional freeholder, signed up to the recent Government backed Freeholder Pledge, we abhor this Machiavellian tactic as it creates unnecessary distress for residents with no recourse to the campaigners own homes (which are often freehold)
4. The price has not doubled, this is the wrong perspective to take although it is a simple leap to make. As outlined above the original developer appears to have offered at a discount. In reality if we were to replace our secure ground rent income with a comparable alternative we would need to invest into Government bonds. A 50 year bond would pay around 1.5% each year so to replace our income we would need a figure more towards £20/22,000 once we factor in tax, costs and other factors
We have been strong advocates of removing barriers for over a decade, as is evidenced in the large numbers of freeholds we have sold to residents. We are very much onside with the Government intent to make the purchase of freeholds cheaper, quicker and easier which is clearly evidenced in this instance. I’ve highlighted below a few of the initiatives used to further this cause
Cheaper – we have averted the requirement for both parties to have professional valuers which would be around £1500 – £2500 of cost
Cheaper – we have refined our process over many years so that the residents are not obligated to engage a lawyer, although they are free to if they wish. Additionally we benefit from economies of scale, which we extend to the residents, so our legal fees are kept to a minimum. If both parties were to engage lawyers I would expect an additional £1000 – £2000 of costs
Quicker – we do not uphold the two year rule, where residents need to have owned the property two years to acquire our interest
Quicker – we have refined the process so that transactions can complete within 7 – 10 days
Easier – we don’t force residents down the formal route to purchase which is far more expensive, time consuming and involved
Easier – residents can simply use our online portal to request a purchase price, pay a small fee and then make a decision from there. In this instance we were paid the valuation fee on 2nd Jan and provided the price on 4th Jan, it would have likely been slightly quicker had it not been immediately after New Year
In summary had we insisted on using the formal route available the costs would have increased by around £3,500/22% of the price, the time taken would be many months and therefore it would have been much more uneasy for the resident
Should the Rices still be minded to purchase, as they clearly were, then we would be happy to instruct solicitors and expect we could complete the matter this month
Regards,
Mark Hawthorn
CEO
—
To be able to evaluate this story it would help to know what the ground rent terms and lease length
All property owners be lessee or freeholders will benefit when interest rates collapse and the effect of the collapse in long term interest rates is still percolating into the value of freehold ground rents
Like all property owners all of us seek the best price . Landmark have done just that but In so doing so have incurred the wrath of LKP
I make this point time and time again . If the terms are set out in a contract that is considered over a few months with solicitors and valuers advising the lessee the imposition of a rent can hardly be seen as unfair . If a lessee fails to consider the terms or their professional advisors why should the freeholder be held accountable for such negligence
I exclude cases where the lessee was represented by this not acting in the lessees interest
The LKP seem to come across as trying to wriggle out of deals where in all but a handful of cases the terms were patently clear. They position the lessees they try to represent as spineless and winging . There are some serious issues that need correction and trying to get out of ground terms does not help their cause one jot
I have dealt with Landmark and found them totally professional
£7500 was the price offered by Elan Homes who then sold on the freehold to Landmark, then £15,900 by Landmark 4 months later ??.
The sooner this money making racket is shut down the better.
a number of retailers buy goods and sell them with a 100% mark up – jewellers in particular – this is what happens in a free market economy
It’s the same mentality that sees it as morally wrong for the developer trying to get the best overall consideration on the sale of a flat by imposing a ground rent which is clearly shown in the lease – they see it as greedy
If however the lessee when selling his flat does a quick makeover for say £3k adding £10k to the value this is seen as perfectly acceptable. Equally a lessee owning more than one flat and selling the surplus flat at a profit is perfectly acceptable. Yet a landlord collecting ground rent is seen as money grabbing and vile
This is someone’s home !!
Have some respect
Its disgraceful and bad practice.
When you arrogantly attempt to compare people’s homes with retail sales you are undermining society homes as commodities
You quote the mark-up made by jewellers etc. When one buys a piece of jewellery you know exactly what you are paying and what you are getting. People buying their homes, be it houses or flats they do not have everything disclosed to them. The sellers may actually be telling the truth, but it is never the ‘whole’ truth, which actually makes it a lie. That is why in court one swears to tell the “Truth, THE WHOLE Truth etc.
The ground rent is usually for no service at all Stephen, and the leaseholder does not usually get a leasehold property cheaper than a similar freehold one to reflect payment of future ground rents. The leaseholders pay for every aspect of the building, the motivation of many freeholders is merely to extract as much money as they can from it. They may care nothing for the leaseholders or the condition of the building, more like a mafia don collecting their monthly payment.
The ground rent is indeed for no service if all . The lease terms confirm this .It is a pure profit stream for the freeholder that is disclosed at the time of purchase. Therefore the lessee needs to consider this at the time of purchase and bid accordingly
I have said on many occasions to help in this the NPV of the rent should be shown
The price to purchase the freehold is not in the contract.
Many people have made this point time and again.
I’m not sure why Stephen ignores this… perhaps Spec Savers could help?
The price of the freehold will depend on when the lessee wishes to buy it and the interest rate prevailing at the time and the value of the underlying property – therefore it cannot be in the contract
Another reason It is not in the contract because the lessee may not want to be committed to buying it if at all
So you agree that not all the terms are not in the contract.
Your doing well at destroying your own arguments.
You still haven’t been to specsavers either… the article says that the price doubled in 4 months. That’s a short period of time.
The value of the property and the interest rates have not altered much in that period, so why double?
If you disagree please show the actual calculations to support your arguments.
The vendor sells a large portfolio of rents at a discount to the full enfranchisement price to an investor . The market price is less than the enfranchisement price . In fact because of the near hysteria about ground rents including wild ideas about 10 YP fits all the market price of ground rents has fallen and thanks to the efforts of LKP landmark appear to have bagged a bargain
When one individual lessee wants to enfranchise it is perfectly reasonable from a commercial point of view to seek the full enfranchisement price from that lessee – the fact they bought it at a discount is there good fortune for having resources to acquire a large portfolio in uncertain times
This is the free market in operation it is the same free market that has delivered to millions of homeowners rising house prices while interest rates fall . Made many workers in final salary schemes millionaires or near millionaires and reduced many mortgage payments to very low levels. It is a complicated model and you can’t simply complain about one aspect of it without recognising the benefits it gives with the other hand
Dear Stephen,
First, the wrath is from Landmark Investments, or more specifically Mr Hawthorn / Hawthornthwaite, towards LKP, whom he terms ‘pathological liars’ etc along with other oafish and intemperate remarks.
If the value of the freehold is so unarguable, why are developers offering to sell it for so much less, and telling MPs at the Communities Select Committee that the difference in value between a leasehold house and a freehold house is only a few thousand pounds?
Your point about the ground rent and lease length is now addressed: The ground rent is linked to RPI every ten years and the lease length is 999 years.
Dear Mr O’Kelly
Unless I’m mistaken weren’t you responsible for the ‘cunt’ article posted on this website (which has now been removed).
Oafish and intemperate….. Pot and kettle.
FC, we can find a name that suits your initials, from the above posting,
I thought the rude word you posted was not necessary as the part blanked out word in the Pemberton posting had 5 digits representing the first and last letter.
I hope it gave you pleasure and in future, you visit Spec Savers who may just help you see things differently.
Firstly we were told we had to use the developers conveyance solicitor who did not have any conversation about any of the terms of contract and were more interested in the developers needs than our own ! The last house we purchased was also leasehold and this did not alarm us to the contract we were taking ! Landmark have claimed the developer originally offered the freehold to us at massive discount which is total fabrication ! I respect that the investor needs to make a profit but this practice is immoral and wrong ,
How can it be that the home owner cannot gain the right to buy the freehold on their own property yet any Tom Dick or Harry with the capital behind them can just waltz in and buy the freehold on a property they have never seen or are even interested in seeing but just solely to extract as much money as possible from the home owners who were duped into this bizarre legal contract ! We are in the process of seeking professional negligence from the solicitor in question and anyone who thinks this practice is business is a disgrace to humanity !
Is it true that you agreed to buy the freehold at the higher price?
we told Elan who agreed that we would be buying the freehold on jan 1 when next ground rent due ! They then sold it on without informing us just 3 weeks before jan 1 knowing I was getting the money in place to buy ! We were so shocked at what they did that we straight away requested price from Landmark who told us we had to pay £50 for ! Their price we found was shocking and upon seeing that this quote lasted 28 days we requested more time and told them we would be getting the money in place via remortgage ! This was in haste and a level of panic ! Then looking into the way we were dealing with Landmark being informal we realised we could not trust this company to sell the freehold to us without any hidden covenants ! So yes we agreed to buy but naively without fully knowing all we needed to regarding formal/informal buying ! The truth is we just want out of this trap that Elan homes and their affiliated solicitors and investors have put us in !
You state that freeholders benefit from low interest rates. That is the case.
You state that freeholders own property. That is incorrect. Would you like to tell us price paid for property by leaseholder vs price paid for Gr.Rent by freeholder. Who wrote these rules?
This is outrageous. Greed over people’s homes and lives. People bang on about social media exposing the dark side of human psyche ..I feel that this abhorrent Leasehold scandal exposes far worse in ‘human’ nature
Cassie, it is more than outrages as those who could have done something even since the LTA 2002. Both Labour and Conservative had piecemeal attempts to reform Leasehold but failed as lobbyists got to them.
People do bang on about social media exposing the dark side of the human psyche.
The leaseholders agreed to acquire the freehold at the quoted price yet are now suddenly hellbent on going down the enfranchisement route and generating unnecessary additional costs? Surely this can’t be right as it makes no sense at all
The price doubled and with an informal offer there is the risk that the freeholder could retain permission fees. This is another reason why the freeholder doesn’t want them to use a solicitor.
It’s now cheaper to go the formal route which also has the benefit of a legal framework to ensure that no permission fees remain.
No doubt they’ve used comparethemarket.com
We were not aware we would be entering an informal purchase until we looked into it ! The sole reason we are now going the formal route is simply because we do not trust anything Landmark say or do as they seem to be making it up as they go along to try and justify their inhuman behaviour!I honestly feel if the developer were to explain the full details of the contracts they make up to suit themselves the new build housing market would implode !
Enfranchisement is NOT only about price it is also about terms of the agreement.
The article states it hasn’t doubled it was originally offered at a discount. If a retailer marks down a product for a period of time and then puts it back to the original price/value its not increasing it just removing the discount. Distinct difference
Not true.
Landmark *claimed* that elan homes offered the price at a discount.
Two different companies.
Tony/LKP etc *claimed* it doubled
The occupier was quoted a price, four months later it doubled. Fact.
The discount is a claim by a different company.
I’ve no involvement with LKP or the individual who reported this article.
However everything in the article is also consistent with the findings of the select committee.
Perhaps you need to study English?
Tony is correct
The freehold was never offered at a discount ! This is complete fabrication on landmarks account !
Clearly, Mark Hawthorn / Hawthornthwaite is an overgrown schoolchild playing with other people’s money with impunity, and playing with the English language as if he understands it but making no sense at all. This is very dangerous, and terrifying that such numbskulls are allowed to get away with so much robbery. It is criminal that there are no checks on such outrages.
Clearly Mr Hawthorn has got a few of his mates to comment on this thread to try and defend the indefensible. Many of whom have made up some stupid names trying to protect their identity.
At least Mr Hawthorn has the balls to not hide his identity.
You are all pathetic. For goodness sake this is people’s homes you are talking about.
Maybe the Easter Bunny will bring you all a moral compass.
Utterly disgraceful behaviour. STOP THESE GAMES. People do not want to play. It’s a game people never consented to.
Katie Kendrick ( National Leasehold Campaign founder)
Those of you that see fit to comment that nothing is wrong here, put yourselves in the shoes of the Rice family.
You were told you could buy your freehold for £7,500 by your developer. At no point were you told this was at a “discount” to market value nor were you told it was time limited. Without your knowledge your freehold is sold on and the new owner now wants double what you were originally told. Through no fault of your own your email landed in a junk folder….
What would you do if you were them?
Why not offer them the freehold for what they were offered originally.? We have no idea what Landmark paid Elan for the freehold. Would they make a loss?
The developer Elan homes sold 18 leaseholds to Landmark out of 55 on the estate ! We telephoned Elan and we agreed to their asking price verbally in sept and were we believed to make the purchase on jan 1 when the ground rent was due ! They deliberately sold it on to Landmark and there is no way Landmark would have paid 7..5k for bulk purchases I’m guessing about 4-5 k each but we won’t find that out as these are all affiliated in the same scam fact !
The greedy get greedier.
Our homes are not * your * investments. They belong to us and our families. So remove your snout from our trough and leave us in peace.
Thanks Mr Burns for helping us to stand up to those who despise us except when they are stealing from us.
The tone and nature of Hawthorn’s remarks expose him for what he is – oafish (for sure), greedy and without principles, other than that of following the money.
How such people are able to look their children in the eye over breakfast is beyond me.
What is absolutely certain is that such amoral people should not be allowed anywhere near the homes of ordinary folk. They should be banned on the grounds that they are a financial health hazard, especially to younger folk.
And, of course, leasehold should be banned. With half the land in England owned by just 1% of the population and the existence of the Hawthorns of this world, I am persuaded that perhaps McDonnell’s proposal to nationalise land should gain traction.
The complementary action would be to close down today’s unethical builders and to encourage transparency and ethics in building that which the population needs, not feeding the bank balances of the Hawthorns et al.
“a number of retailers buy goods and sell them with a 100% mark up – jewellers in particular – this is what happens in a free market economy”
Except it is a consumers choice to buy jewellery or any product or service at a 100% mark up in a free market economy.
It is entirely different when a ;leaseholder has bought a home believing they could buy the freehold or be treated fairly with consumer rights only to find out that they have no choices.. Unbeknown to the leaseholder their freeholder could switch hands at any given time for investment purposes only, The leaseholder is then stuck between the freeholders terms and everchanging fees and what they thought was a home rather than a lifelong burden.
This is what is called as trapping and that this industry is certainly not a free market economy. At least not for the leaseholder….
Their is a defined formula for enfranchisement and lease extensions . The price can be ascertained within a narrow range (particularly when the term is long) so a lessee being represented in the purchase should be able to know what they are committing to. After all they have a solicitor and a valuer acting for them
I if a lease term is patently clear that the rent is £x and will rise in line with a formula if that deal is to be revoked later on then it is only reasonable to expect the recipient of the rent to be compensated fully for the lessee wanting to change his mind and not return the property at the end of the term as originally agreed
Trying to avoid paying the correct level of compensation by arguing it’s all wrong and ground rent is for no service or the freeholder is being greedy by having a ground rent anyway are weak arguments .
Some need to recognise that they committed to a term and because of the collapse in interest rates have to pay more than originally thought
A lease is a contract and in a high functioning society such as ours it is important for these terms to be entered into with professional advice before hand and then observed.
Cry’s of “I didn’t know what I was doing “ or it was all on legal speak or “I just wanted a home not be part of a home with an annuity bolted on to it”are really rather weak and undermine other contracts
“A described formula, the price can be determined in a narrow range ” You really do think leaseholders are stupid dont you.
The capitialiation rate is a real battle. .1 % makes thousands of pounds difference.
Hence why you greedy freeholders argue a low cap rate.
You can try to defend the indefensible as much as you want but your doing it in the wrong place. We know what morally indefensible your practices are.
You talk about compensation. Well for those who have been mis sold I will fight until they get the compensation they truly deserve.
I hope you find your moral compass in your Easter egg.
A lease is often a one sided, unbalanced contract with unknown rising costs, whatever the freeholder can get away with including excessive permission fees and admin charges. Legal extortion, at least the mafia don’t claim to be legal.
Hmmm, valuing a lease sing a defined formula, it doesn’t come across simple, looking at the different variables that can influence the price.. I for one as a leaseholder would have more confidence in achieving an honest appraisal utilising a company recommended by LKP than Landmark.
Well, defined terms.in the lease that are blatantly clear, I’m yet to see a blatantly clear lease, including my own and it still doesn’t explain how RPI mechanisms work, unlike.my PCP on my car which states EXACTLY how much I pay, when and how.and when I can end the agreement, unlike my £250k+ house.
Stephen is correct however, I am trying to avoid paying ANY compensation as I feel the freehold should have come with my house and.not be a third party asset. BMW dont own my V5 registration and even if I defaulted I have more levels of protection than my house.
The cries of anguish are indeed real not crocodile ones like Hawthorns, it as per the select committee findings a matter of public record that leases are written in a manner so as to obscure the meaning of what terms to are accepting, solicitors, mainly seem to take the lease on face value rather than using due diligence when assessing it and advise or.mis advise accordingly.
So let’s be honest here, the system, the process, the benefit of leasehold housing market is all stacked against the buyer. Remove the system and non of these.problems would exist, please dont justify freeholders as being there for.our benefit. Ground rent is unnecessary unneeded and unwanted by home owners, the only people that do are investors, solicitors and developers whom expect us to go away quickly and quietly, which of course, we will not. ????
“If that deal is to be revoked later on then it is only reasonable to expect the recipient of the rent to be compensated fully for the lessee wanting to change his mind and not return the property at the end of the term as originally agreed”- The “deal” I thought I’d entered into was to purchase a house from a developer using a cash deposit and a mortgage. At no point in the discussions with the developer, lender or pet solicitor was I advised I would not actually own the house and I would have to hand it back as “Stephen” states. I did not originally agree to that nor did I sign the lease contract and yet I found myself bound to this “deal” paying a faceless third party £295 a year for absolutely nothing.
I and thousands (if not millions) of others were simply conned by developers and solicitors colluding together for financial gain – it was a well thought out business strategy.
Freehold investors may also have been in on the plan – who knows- unless you do Stephen?
This is exactly what has happened the developer their solicitor and their affiliated investor it is a scam that need to be made illegal these investing greedy monetisers are a disgrace to humanity but I do believe karma will catch up with them !
What is fundamentally wrong with my logic
I am developer and I want to sell a flat with a ground rent of say £350 per annum linked to the RPI every 10 years. I make those term crystal clear and disclose next to the proposed premium that the NPV value of this rent is £10,000
A purchaser comes along and has a valuer value the property and a solicitor review the lease and after 2 months of going backwards and forwards a deal is struck
A few years down the road the lessee changes their mind and wants no longer pay the ground rent and also not return the property at the end of the term despite having agreed to do so after being advised by professional advisors prior to purchase
Not unsurprisingly the freehold feels aggrieved and seeks adequate compensation and looks for variables priced off gilts. He is then accused of being greedy , and that it was totally wrong in the first place to have a ground rent and the figures used to fundamentally wrong and not in the leaseholders interest and somebody should come and sort out this horrible mess
An observer visiting from another planet would think the leaseholder to be a spineless two faced individual . Spineless for not wanting to stick to the terms agreed and two faced for on the one hand agreeing to a ground rent and then a few years later changing heir mind. I fully accept that a lessee should feel aggrieved if the solicitor acting for the was in reality acting more in the interests of the developer
I challenge any of you to reply without name calling or bringing up red herrings why the freeholder in my example who makes a full disclosure of the terns as outlined at the beginning of this post should not receive adequate compensation which in an era of very low interest rates may be surprisingly high.
This is what’s wrong with your logic….
You assume that we all made a fully informed decision with all the facts. We were not fully informed, deliberately so in my opinion.
I don’t need or want to call you names. Put the shoe on the other foot and see how you feel.
If you were not fully informed whose fault is that?
It is your professional advisors to whom you paid not insignificant sums to – it is not the freeholders UNLESS you were forced to use a firm who have not acted in your best interests in which case the blame rests with the developer
The majority of people caught in this scandal have been duped and not advised by the solicitor as in our case we were duped into believing we had to use the developers solicitor and we were never contacted by the solicitor about the contract ! This is our second home and the previous was leasehold peppercorn rent we therefore blindly thought nothing of it ! The whole point is the developer the solicitor and the investor are all in this together to generate money over and over it is disgracefil
The fundamental problem with your argument is … that developers are not deploying it.
They told MPs of the Communities Select Committee that the difference in price of a leasehold house and a freehold one would be a few thousand pounds. Not multiples of ground rents and bond yields or the other self-interested arguments used by those in the ground rent game.
So if even developers are not using these arguments, there is no reason at all why policy makers or the Law Commission should pay attention either.
Stephen – in response to your challenge – “why the freeholder …who makes a full disclosure of the terns…should not receive adequate compensation”. The reason is developers DID NOT FULLY DISCLOSE the terms of the lease – and you will know this if you have been following or have any interest in this debate! You say ” I am a developer and I want to sell a flat with a ground rent of say £350 per annum linked to the RPI every 10 years. I make those term CRYSTAL CLEAR”… My lease (and tens of thousands of others) was the exact opposite of ‘crystal clear’ – in fact it was clearly designed to mislead and deceive. The clause relating to the doubling ground rent was spread across three separate ‘clauses’ and two definitions, many pages apart. The word ‘double, or doubling was never used’. This is no coincidence and it is now known that developers were attending courses in the mid naughties to learn how to monetise leasehold to maximise profits.
I bought in a block with 200 other owners, and having got together through FB recently, it is clear only a handful of people were aware about the doubling ground rents. The vast majority include people like myself – landlords, professional people, businessmen & women, as well as police officers, nurses and drs, and others that would be considered responsible, educated reasonable people – all who cannot be written off as fools who “didnt read the lease properly” . My solicitor and lots of others were either similarly duped or culpable – its one of the other. This is right at the centre of the argument. It is undeniable and your strategy to blame the leaseholder or their conveyancer does not cater for the fact that this ‘new’ strategy of monetising leases (ground rents, increasing, permission fees, etc) began recently from around 2005 onwards), by design, and was forged to dupe, deceive, mislead and abuse the leaseholder. Very few people were aware of it until the firsts doublings started to happen from around 2015, and this is why it has accelerated in the last couple of years as ground rents are doubled and people realize they have been tricked. It has absolutely nothing to do with LKP whipping up a storm or a handful of unhappy leaseholders.
Now that this practice has come to light, homes are unmortgageble, and unsellable. This tells you that had it been understood and stated clearly (crystal clear you say) in the lease (and not hidden) ten years ago – no one would have purchased.
One great thing about this Campaign is that Leasehold has now become a toxic term, and it’s less likely people are going to fall for it, or solicitors are going to be complicit or simply unaware of these terms, no matter how well hidden. The horse has bolted – you and those on your side of the argument have effectively killed of what was your golden goose with your greed. It’s disturbing how anyone with any moral code could think the current situation was in any way justified, and it was satisfying to see the select committee agree…
Another Scam in the lease is the doubling of Ground Rent every 33 years then doubles again after another 33 years (99 total). The lease claims the GR is Peppercorn and is £48 for first 33 then £96 and finally £192.
I understood Peppercorn to be a nominal sum which was originally only to complement and continue the contractual arrangements of the Leasehold Tenure.
We are aware that the first 33 years begin with a date agreed between the Head Lessor (Freeholder) to the Lessor (Managing Agent). The sale of a lease for a flat that is sold last maybe 3/5 years after that signing, meaning the first 33 years a leaseholder may only be 30 years, or proportionate as the lease states, friends any comments?
This is so wrong this is someone’s home not something to make a profit on or for a pension pot ! People need to wake up and realise this is wrong so wrong.
Back during 2018 , the Secretary of State Minister, MHCLC was Sajid Javid and he was talking about ending the registration of leasehold house. Then he got rotated into another post and now we have James in the chair.
The sale of these freeholds by Elan Homes to Landmark is obviously a spanner in the works to attack and disrupt feeble Government Policy trying help the scammed leaseholders .
If James Brokenshire has any business sense he should be tough and enact announce a law to let the leaseholders of houses buy the freehold at 10 times the annual ground rent and give full support to Justin Madders 10 Minute bill.
Its not his concern if the freeholder loses money and they can always claim for loss against Eland Homes.
ollie, I agree I purchased my first leasehold house in 1983 and purchased the Freehold as well for 10 times the Ground Rent – £35 times 10 = £350.
You bought at 10x in 1983 when the base rate was 9%
2019 base rate is 0.75% which is 12x less than 9% so would require a price of 120x your rent to remain at parity
This would also mean the prop in this article would have been around 5x the rent in 1983
This is not an opinion it is a simple mathematical comparison equating two separate points in time
Mr Maths the point I was making was the agreed rate at that time was 10 times the GR not 30 or 50 times.
The house was built in 1919 and sold in 83 for £35k, GR had already doubled.
From your figures and a 120 parity would have made the GR equivalent value of £4,200 a year which would have doubled again in 1985, making GR today being £8,400 and would have been out of lease in 2018 or would have paid over K10 to extend the lease?
The money made by the Freeholder included the refurbishing would have made the Freeholder a fortune and then owned property worth today £350k, not bad for one house.
Ignoring your inability to comprehend the major point of the post….over the last 36 years this property has gone up 10x in value (£35k to £350k) and the £35 rent will have increased by a factor of 2
These are your figures that I’m presenting to you!
I repeat the major point I made, which I am entitled to do. Your figures for the basic rate are of interest to you, as part of your argument relating to Leasehold and against the many who have proclaimed they were cheated and lied to by professionals who knew what they were doing.
I believe as statistics go, it is a one-sided approach, by those who benefit from Leasehold Exploitation, who pretend to provide professional advice and information.
You are entitled to argue your side and dirty any waters you please, but please Mr Maths, provide a name, as most posters do?
This thread alone should see English leasehold for citizens’ homes abolished.
There is a lot of talk about market value and free market.
All BS.
Leaseholders buy their home at full market value.
No discount for GR.
There is a dense and often unreadable contract.
They pay all costs.
The retained freehold is merely a monitising gimmick.
The market value for it cannot be tested .
Unlike the real free market and true market values, freeholds have ONE trapped buyer. The leaseholder.
Leasehold operates in the fantasy world of No Act nonsense. The only way a leaseholder could verify the market value of the freehold is if somehow the market value could be tested.
Leasehold is a scam.
Catch yourself on anyone who defends it.
Government know it is a scam.
They promised to fix it.
This lot couldn’t govern a teabag into a cup.
This thread should be pasted on every MP’s fridge door. When they reach for the milk they forgot to order.
Why do you think this is acceptable, profiting from normal working people. This is abuse of so many millions of families lives.
We are suffering because of your greed. We were lied too and then took advantage off. Yet you are creating more problems, we just want what we were we told would have happened in the first place. Our freehold at the said cost at point of sale.
You have conned us and in my eyes you are criminals.
And criminals should be locked up xxxxx
These companies like landmark have abused the help to buy scheme. Most have no option other than to buy a new build with the 5% to get onto the property ladder for it only to be tarnished when the lease is sold from under them even when they have enquired to buy it at time of purchase. There is absolutely no need for a detached property with no shared spaces to have a lease and it’s purely a scam to extract as much as possibly for the buyer.
Its funny how the same developers are now not selling properties as leasehold at the same price as previously with the threat of the help to buy scheme being withdrawn form them.
A developer acting in a free market economy is expected to seek the best overall consideration for his product and if by selling leasehold he exhorted more then so be it . Just as the homeowner selling the property on will try and present it in an economical way to get the best price
What is not acceptable if the terms of the rent reserved are hidden or designed to deceive but if clearly set out in the lease and the lessee is independently advised in the transaction then I see no issue with the imposition of the rent. It’s NPV to be shown next to the consideration paid with the premium and the NPV of he rent being used to calculate the SDLT
A developer owes no obligation to be charitable and hold back on getting the best overall package. Just as a purchaser should not overpay if the developer has overpaid for the land and construction costs.
Complete transparency on the rent terms and lease term will ensure that there can be no abuse
With regard to consent fees etc these should be capable of being challenged by way of a paper review through the FTT
Haven’t you noticed that it is not a free market? That taxpayers have poured £10 billion into Help To Buy; that we are all subsidising purchases of many new builds to get others on the housing ladder; this is particularly the case with Elan Homes, which emphasises Help To Buy throughout.
As you do not believe that leaseholders should have the right to enfranchise (against the wishes of the freeholder), you could be described as having an extreme pro-sector viewpoint on these issues.
Upton Sinclair’s quote seems taylored for you:
If tax payers money are poured into “help to buy” , the Chancellor , HMRC and the Commissioner of Taxes and every branch of Government have obligations to ask all tax payers to sign the petition started by Katie.
Even the LEASE website should be displaying this petition.
Gavin Barwell , a previous Housing Minister has said the LEASE must stand behind and show support for over 4 million leaseholders who are paying tax at 20 and 40% tax rate on their earnings.
Admin, couldn’t agree more, this thread has done more good for the Leaseholders than the so-called Freeholder even when friends have attempted to dirty the water by adding statistics to what is already a quagmire of facts to enable those to continue making their money, from Leasehold Exploitation.
The phrase “a little knowledge is a dangerous thing” is a perfect summary for the majority of the comments on this thread across an embarrassingly wide range of subjects to include basic law, economics, the property market, arithmetic and logic. The only subject where many are clearly well qualified is presenting their own, typically massively flawed, opinions as facts
Is Super Admin, really Mr Maths in disguise?
I have to agree with him, he is clearly well qualified is presenting his own, typically massively flawed, self-centred opinions as fact. He is possibly a developer in a so-called Free Market economy, who Upton Sinclair’s quote seems tailored for:-
“It is difficult to get a man to understand something when his salary depends on his not understanding it.”
I still despite all the protestations cannot understand why when a developer sells a property leasehold where the ground rent terms are shown clearly along with the term . A leasee comes along agrees those terms with professional advisors helping . Agreeing to pay a rent and return the property at the end of the term
Then when having moved in the lessee wants to go back on those agreed terms and considers the freeholder to be greedy and immoral for wanting to be fully compensated
Aside From where advice was compromised by solicitor not acting in their clients interest the deal should stick
We do an enormous of property deals and find dealing with the general public tiresome with their blaming compensation culture – we only deal with commercial landlords who are generally more grown up
Have you considered that this might be your failing rather than that of others?
Not just the aggrieved leaseholders commenting here, but MPs of all parties, journalists, Conveyancing Association, National Association of Estate Agents, Chartered Institute of Housing etc, etc et bloody cetera.
Leaving aside this particular case, house builders receiving enormous dollops of public subsidy in the form of Help To Buy set out to shaft their own customers with onerous and well camouflaged lease terms. The law – wrongly – allows them to recommend stooge solicitors to rubber-stamp transactions. The added bureaucracy of Help To Buy hinders any independence in the sales process.
After we sounded the alarm bells, the banks woke up – finally – and said they were not lending on these flawed products. This lands ordinary families in the predicament they now face.
You are falling back on cliches like “the general public tiresome with their blaming compensation culture”.
You are wise in one thing: seeing future business opportunities in commercial property transactions.
The residential leasehold game is a once-rich seam that is now played out. Bill Procter, of Consensus Business Group (Tchenguiz) correctly talks about an “existential threat” to the sector.
It overplayed its hand and got too greedy.
You are right to diversify.
“Not just the aggrieved leaseholders commenting here, but MPs of all parties, journalists, Conveyancing Association, National Association of Estate Agents, Chartered Institute of Housing etc, etc et bloody cetera.”
….none of whom have any real understanding as evidenced by the fact we are where we are and their poor ongoing contributions. There’s a knowledge imbalance in favour of freeholders, which is not their fault and to an extent this deep understanding provides a safety net which maybe not accepted but is in evidence when issues arise (accepted not all freeholders are professional but the bigger ones)
Hands need to be held up on all sides, including LKP for inciting combative friction, and an overhaul instigated. Education is key and whilst LKP sometimes appear to try to help in many instances – to a bystander – the actions look designed to frustrate progress and exacerbate issues
Well, we are happy to publish all arguments, and have invited freeholders, developers sector professionals to express themselves here or at the APPG. We also attend public events at the sector – when we are invited – and are happy to debate issues.
Again I make the point that the NPV of the ground rent should be shown next to the premium so no poisonous clauses are inserted – I have said this on countless occasions
Informed MPs have advised professional freeholders to abstain from contact with “militant” LKP for quite some time. Plenty signed up to APPG but similar to NLC there’s only a fraction of a fraction active
Smear.
A weak defence and clear acceptance in one!
Stephen,
A Churchill Retirement advertisement makes the offer to pay purchasers legal expenses if they use a solicitor on the panel recommended by them?
How likely do you think it would be for any of those solicitors to offer truly independent advice to purchasers?
Were those solicitors ever to say to a client “This purchase may not be in your best interests” how long do you think they would remain on the recommended panel?
If you read what I write – please re read it as you have not read it properly – – you will see I state on several occasions that lessees have every right to feel cheated if the solicitor who acts for hem is really acting for the developer
Solicitors acting in cahoots with developers and their associated freeholders. 1000s of people saying similar cannot all be wrong. Cowards on here who use false names, dodgy maths, and false arguments. Their money making scam is on the way out, now they are crying about it.
Surely you see the irony, perhaps intended, in “Simon says” it’s only missing the prefix “simple” or dare I say “Sebastian O Kelly” who has many names on this website
Surely you see the irony, perhaps intended, in “Simon says” it’s only missing the prefix “simple” or dare I say “Sebastian O Kelly” who has many names on this website
No, he doesn’t.
Simon is spot on:
“Some conveyancing solicitors have become too close to developers and did not put their client’s interests first.”
– Select Committee enquiry report into leasehold
Does Clive believe, what he has to say is so good, he has to say it twice?
This posting seems to be similar to Mr Meths and Supper Admin.
Thank you Stephen,
So that means between 90%-100% of new build lessees have a right to feel cheated?
Do you agree then that the practice of purchasers being “encouraged” or “incentivised” to use a solicitor connected to the developer is unfair?
Michael, I remember in 1982 when I put my first house on the market I was asked if I wanted to save money by using the same solicitors to sell and buy. This didn’t seem right as solicitors are supposed to be professional and independent.
When I sold my second house in 2008 the solicitor also acted for the purchase of the Peverel Flat. I was not given any information by my own solicitor regarding Service Charges, Exit Fees, and Permission Fees.
This information came from a very good Estate Agent and the vendor’s solicitor, The real problem was no one was aware of the Managing Agent, Peverel Management Services Ltd, trading as Peverel Retirement, now Firstport Retirement. The name synonymous with Peverel Group and now Firstport is William (Bill) Proctor CEO/Director of Consensus Business Group (CBG) whose Ultimate Owners are the Tchenguiz Familly Trust (TFT).
TFT contains many of the companies that have been mentioned on sites, like this site, going back to the 1980s, which saw the beginning of Websites such as The Truth About Solitaire (TTAS) Peverel Action (PA), Campaign against Leasehold Exploitation (CARLex) and the latest excellent About Firstport (AF).
The first two sites TTAS and PA closed for postings but can be found on any Search Engine worth checkings out.
It seems Bill is worried as he is known to talk about the Existential Threat” to the Leasehold Sector since LKP and some excellent MPs and Websites that are a platform for Leasehold Exploitation.
Surely the encouraging or incentivising by developers to use a Conveyancing Solicitor that has connections, to the developer is not just unfair but has been used unfairly knowing the outcome to be very beneficial to those who employ them. When things go wrong, complaints are made they have a ready-made “Whipping Boy”, to blame, then disassociate themselves.
Pre-planned?
Iit is unfair where lessees are encouraged to use solicitors who will waive through ground rent terms where they are not clearly disclosed
There is nothing wrong with a ground rent that doubles every 10 years PROVIDED that the NPV of that obligation is fairly reflected on the price paid
The Help To Buy Scheme, funded by taxpayers money, should never have been allowed to be used to purchase a lease (leasehold property) when there was no need for the property to be leasehold.
The government/housing ministers, full of promises of action, could have stopped the use of HTB at the stroke of a pen when it all came to light around 2/3 years ago now I believe
I will never tire of quoting Crispin Blunt (Conservative) MP for “leafy Reigate”:
“Present-day “onerous ground rents” are, more likely than not, the resultant of unconscionable conduct carried out by one sector of society who have superior information flow (developers, freeholders’ funds, financiers, solicitors) at the expense of an unsuspecting and more naive part of society (consumer homebuyers).”
“Titles to people’s home is demonstrative of their ownership to their home that is to serve as a physical shelter and emotional safe haven for the family. Shelter and security is a fundamental need”.
“Government can support existing leaseholders with onerous ground rents by passing legislation to unwind and nullify those payment obligations”
.“I advocated there should not be any ground rent as property title should be either freehold or commonhold in the future”.
Our dear friend, Stephen’s response to my quoting Crispin Blunt was effectively “that is his opinion, it doesn’t mean he is right”.
It is quite remarkable the sophistication of arguments (including advanced mathematics) – for and against – deployed here at LKP when it is as plain as a pike staff that leasehold is wrong. It is one of many evils alive and well, and thriving in 21st century UK.
Those on the leasehold gravy train would have been slavers in times gone by, there will always be evil men, and there will always be outlets for the expression of their evil.
David, a good post.
I was recently informed by a group of Leasehold Tenants that having read the websites regarding Leasehold Exploitation, it seems Freeholders, Landlords & Managing Agents reminded them of a cross between Rachmanism and a Lone Shark.
Perec ( Peter) Rachman was a Landlord who began his career working for an Estate Agent and by 1957 had a Property Empire in London. He also became notorious for his exploitation of his tenants, with the word “Rachmanism” entering the Oxford Dictionary.
Then we have the Lone Shark who once involved keeps on charging more and more for less.
Leasehold Tenants pay:
*Cost of purchasing the flat
*Legal Fees
*Estate Agents Fees
*Management Fee
*Service Charge
*S20 Notices
*Ground Rent (Doubling then Doubling again)
*Lease Extensions
*Permission Fees
*Exit fees
*Keeping Pets
*Sinking Fund
*Operating Costs, that have been unilaterally transferred to Service Charges
It seems there is no end to the milking of the Cash Cow that is Leasehold.
Thank you Chas, but your thanks should go to Crispin Blunt who, with his representation to the Law Commission, said it all about leasehold and those who feed of it, An astonishingly correct and proper condemnation of the moral criminals involved – this includes government as well as the developers and suited professionals.
Note: I say “astonishing” above because Crispin Blunt is not only a CONSERVATIVE MP but one who has in the past made apparent his aloofness towards the common man..
I was wondering how many comments I would read before the true cost of a leasehold purchase would be listed. I became aware of the true cost when I purchased a M&S flat in 2004 which I sold in 2017. I was one of the many who was talked into by a fast talking salesman to use the M&S solicitor who rushed he completion thou before I was able to, understand the terms of the lease. My other mistake was believing the salesman when he said I would be aloud to purchase the freehold for 10 times the £450 ground rent.
Norman, you will be pleased to know that McCarthy & Stone have made 200 people redundant and their profits have dived by 66%.
What was that saying? Cheats never prosper!
Michael, How right you are. I am looking forward to 100% +++++dive.
McCarthy & Stone (M&S) and Firstport Retirement (was Peverel Retirement) are Both as bad as each other as most of the Scams were started in the 1990s and they learned from each other.
Norman I remember you saying this to me many years ago and it seems they continue to provide similar dross in their advertising such as Virtual Freehold.