Galliard, one of Britain’s biggest housebuilders, has introduced “Brexit clauses” that give buyers the right to pull out of a deal to buy a new home if Britain votes to leave the European Union.
Galliard Homes, the largest privately owned property developer in London, said that its contracts now came with a clause allowing a housebuyer to pull out of a deal and get their money back.
“These are not normal times,” Donagh O’Sullivan, its managing director, is quoted in the Times. “We recognise that people are fearful. We want to acknowledge the very real risk to the economy …”
Full marks to Galliard for coming up with a referendum specific marketing wheeze, but how about this as a more important issue:
Flats are routinely bought off plan – from all developers – without buyers having the slightest idea of what is actually in the lease. That comes later.
And, extraordinarily, buyers fall for it.
There may be some indication of the length of the lease, but ground rents (and when they rise), whether there is a residents’ management company, or an embedded one in the lease, and numerous other nasties that may be introduced to the lease at a later stage are completely unknown.
It is astonishing that people undertake to buy property without knowing what they are actually getting.
Is there any justification for this? … At all?
Related posts:
Leaseholders face £19m to £40m Grenfell cladding bills at Galliard Homes’ New Capital Quay
(Galliard v NHBC v the Government v Cladding suppliers) v the Leaseholders
ARMA ends four-month farce after finally saying who its members are …
Galliard Homes ‘needs to take responsibility for what it has built’
New Capital Quay leaseholders to sue Galliard over Grenfell cladding
LKP meets Roger Southam and Taylor Wimpey over embedded management companies
Is it not the case that some potential purchasers who want sight of the lease are told they can only see the lease if they put a deposit down first?
I wonder what the next scare tactic will be?
Perhaps if we vote to Leave, Firstport Retirement will be admitted to ARMA?
That is quite remarkable, I had no idea till I read it here. It should be noted that most first time buyers, in London at least, don’t even know what a lease is and are not entirely sure if what they are buying is share of freehold or leasehold. They are just grateful, they found a flat at all in a competitive market. The average conveyancing lawyer acting on behalf of a buyer will do the basic minimum, whilst shrewd freeholder lawyers will continue to exploit. I am thinking of moving to Scotland….
I have done a little mastery shopping recently on Esate Agents to see who were advertising leasehold properties and new build flats and houses. I was astounded by the lack of understanding or ignorance by the employees of these companies I talked to regarding leasehold properties on their books.
Some were very avasive when asked direct questions, whilst others were just plainly uneducated about leasehold, so how can they be competent to sell these properties?
One of the main objections I received when asking for a copy of a lease before putting in an offer, was that it had to be sent to my solicitors and couldn’t be emailed to me!
It should be offered up front at the point of enquirery now, together with details of the buildings insurance premium and service charge fees.
The flat above mine was up for sale, it has an informal lease with a ground rent of £450 pa. As a matter of interest I rang the estate agent pretending to be interested in the flat for a relative. I enquired as to who was responsible for the extensive front garden and was told that the ” service charge” of £450 would probably cover it. Obviously the staff had no idea that this figure was indeed ground cent and covered absolutely nothing as we are responsible for our own maintainence. Another thing I have noticed in sale adverts is the range of lease extension descriptions eg lease extended for 125 years, or 100 years or lease extended to 100 years. Often the advert will just say that they have no information about the tenure. If should be mandatory to give lease information from the outset before the purchasing process gets started.
This is a very good point, and possibly involves Consumers’ Rights legislation.
It would be very useful if this were brought to the attention of government, via your MP and the housing minister.
The Leasehold Advisory Service should be interested as well, as it is constantly talking about the need for proper “education” in leasehold.