… It is unsellable, say leaseholders
… Taylor Wimpey assistance scheme a ‘publicity stunt’
… and why has the freehold ownership transferred FOUR times?
2009 Taylor Wimpey
2012 UK Ground Rent Estates (3) Ltd & Wilson Connolly Ltd
2015 Adriatric Land 2 (GR2) Ltd
2017 Adriatric Land 1 (GR2) Ltd
Taylor Wimpey leaseholders in St Helens have laid out the disastrous state of their home purchases to Marie Rimmer, Labour MP for St Helens South and Whiston.
Marie Rimmer made a powerful intervention on the leasehold house scandal at the All Party Parliamentary Group meeting on leasehold reform on April 19.
Now constituent Lisa Chapple has laid out how these toxic leasehold assets impact on her and her neighbours.
Like so many other Taylor Wimpey customers, Lisa Chapple will not have owned her leasehold house for ten years before the ground rents double in January 2018.
Over the next 60 years her small leasehold house will pay out £185,850 to the freehold owners in ground rent alone – leaving aside various consent fees and other charges.
- 2008 £295.00pa over 10 years £2,950.00
- 2018 £590.00pa over 10 years £5,900.00
- 2028 £1180.00pa over 10 years £11,800.00
- 2038 £2360.00pa over 10 years £23,600.00
- 2048 £4720.00pa over 10 years £47,200.00
- 2058 £9440.00pa over 10 years £94,400.00
Others at Speakman Gardens pay £250pa ground rent a year, rising with RPI.
“These onerous leases of doubling or RPI are/have made our homes unsellable but more importantly, long-term we won’t be able to afford to stay in our homes due to the extortionate increasing ground rent fees,” says Lisa.
Lisa was one of the demonstrators at last week’s protest in Manchester.
She dismisses Taylor Wimpey’s perhaps unworkable Voluntary Ground Rent Assistance Scheme as a “publicity stunt”.
“Taylor Wimpey proposed to change those of us with ‘doubling’ clauses to ‘RPI’ but only if the freeholder (sometimes offshore investors) will agree this.
“Taylor Wimpey’s recent publicity stunt to apologise and set things right, stated they have set aside £130m to correct this mess. However this money will be only benefit the freeholder and not the leaseholders themselves.
“The offer is voluntary and it came with a timeframe. We had to express our interest by 30th June 2017 as this was Taylor Wimpey’s deadline to leaseholders with doubling clauses.
“Although Taylor Wimpey has proposed changing leases, they fail to provide any clarity regarding if this offer is of any benefit to us the leaseholders i.e. Timescales of when this could happen?. Would the ground rent still double in January 2018 before we change to RPI?
“They can not inform us when this would occur, nor if there would be any restrictions to changing the lease i.e. If we can buy the freehold as usually changing the lease means not being able to purchase the freehold for a further 2 years etc.
“Taylor Wimpey have been negotiating with our freeholders WITHOUT our consent, to see if they can change our leases and the £130m is effectively to make a deal with the freeholders rather than helping leaseholders.
“Taylor Wimpey are refusing to share how many properties are affected by their greed and are only offering the voluntary scheme to those leaseholders that have complained to them directly.
“Our concerns are that some leaseholders may not yet know about the lease clauses, as many people may not use social media and therefore they would have missed an opportunity to complain.
“Taylor Wimpey should be contacting all leaseholders affected by this, not the other way round!
“It is evident that they are doing as little as possible to rectify the mess that they have caused.
“If we change to RPI after we have doubled in January 2018, then the ground rent based on £590.00 plus inflation every 10 years for the term of the lease 250 years, will be as onerous if not more than the doubling clause that has already been enforced on us. Hence the reason for our discontent!”
Lisa says that when she bought her home in December 2009, she was advised that she would be able to purchase the freehold after two years at 10x the annual ground rent of £250 = £2,500.
“This turned out to be yet another lie from the sales representative as when we have attempted to get a valuation for the freehold from the new owners, they are stating the freehold purchase is now £40,000.”
Lisa claims Taylor Wimpey sold the freehold of each property on Speakman Gardens to third party investors within months of the buyers moving in.
In 7 years Lisa has had four freeholders:
2009 Taylor Wimpey
2012 UK Ground Rent Estates (3) Ltd & Wilson Connolly Ltd
2015 Adriatric Land 2 (GR2) Ltd
2017 Adriatric Land 1 (GR2) Ltd
Lisa also terms the government’s Help To Buy scheme as a “scam”.
LKP has already pointed out that it should be renamed the “Help To Invest” scheme, for housebuilders and the murky investors who scoop up residential freeholds.
“This government backed scheme is another scam to keep people in debt. It was not explained that it was an ‘interest only loan’ and the only way to pay it off is by either paying the full amount or to ‘stair case’, but this means paying two sets of surveyor fees for our homes to be valued each time to pay the loan of in 10% chunks.
“I can’t remortgage to consolidate the loan as its too high. Mortgage companies now won’t lend due to the doubling ground rent clauses. Therefore I’m left with a debt that I pay for each month and have been for 7 years, but it never goes down!
“Some residents homes have devalued so much due to the doubling/RPI clauses, which means some people have been able to pay back their loans at a less percentage. This is the only benefit to a bad situation.”
Lisa has urged Marie Rimmer to ensure that local housing is now only built with freehold tenure, and that the developers’ leasehold racket is brought to an end.
“Many people could face losing their homes due to these extortionate annual ground rent fees and this will increase the level of homelessness and /or the need for more social housing.
“It is interesting to see that these extortionate leasehold ground rents appear to be significantly more in the North West and North East of England, where most areas are working class people in socially deprived areas. There is no need for the extortionate ground rents, apart from developers financial gain and freehold investors long term financial gain.”
This is where local councils need to step in. Houses being sold freehold should be a condition of planning permission. Local councils have allowed this scam to continue.
When you put it like that, I ve paid on average £1800 a year service charges for my 1 bed flat. (Which I am told is very reasonable). Over the period of 25 years I’ve lived here that makes it £45,000 excluding major works and ground rent. Major works were approximately another £10000 so that’s £55000. According to the lease I pay 20% of the outgoings which makes the total outgoings for the whole building £275,000.
One would think with £275,000 the place would look like a palace now, we would not have a leaking roof, broken balustrades and dilapidated windows. Ya Think? It’s not a big house, it’s a terraced conversion, no lifts, no grounds.
I’d love to see proper accounts from the last 25 years, they should be mandatory. And no idea why HMRC doesn’t look into our dodgy freeholders…
Thank you for this really informative article that clearly sets out the issues with all leasehold new build. Although this dubious practice has been going on for a very long time the doubling ground rent has instigated closer scrutiny on a national scale and should be seen as an opportunity to change things.
All political parties need to take note – this will not be a one hit wonder – leaseholders have found their voice and we are not afraid to shout it from our rented rooftops because frankly we have little to lose in this battle !
I like your comment about ‘shouting from our rented rooftops’.
It’s true though that murky investors are scooping up residential freeholds making leaseholders into their serfs. They do need to be stopped, or we shall have no place to live. I am beginning to support radical thoughts like ‘wealth redistribution’ …
These unscrupulous individuals who build up Freehold/ ground rent portfolios and then appoint their equally unscrupulous managing agent to shaft the unsuspecting leaseholder by committing fraud ( insurance) and general thievery must be brought to book! They must have their collars felt like any common criminal. As well as the excellent NLC campaign which I wholeheartedly support, a campaign of equal vigour must be initiated to campaign for the strict regulation of managing agents. Also, solicitors who clearly sail very close to the wind in doing the bidding of these crooks should be reported to the SRA, I’m pretty sure the same names will regularly occur. If anyone is interested in starting a campaign then contact me via LKP. We must act.
As regards strict regulation of Managing Agents, that is what both ARMA and ARHM are supposed to do.
Unfortunately they are not strict at all and only advise or slap wrists when their members contravene.
The serious offence of price fixing did not even receive that.
Hi, sadly leases are contracts and by virtue of conveyancing, the buyer uses a solicitor. I did. No advice at all on leasehold being bad for my wealth.
Talk seems to be of strengthening consumer rights on unfair contract terms to include leases? I bet a jam sandwich of your choice that the courts, who habitually find escape clauses for freeholders, will argue that the buyer had the duty of care to choose a knowledgeable solicitor and, unlike somebody buying a fridge or a holiday without legal advice, the buyer who simply takes recommended solicitors on face value must suck up the poor advice and sue the solicitor if unhappy. I see no reason why the courts won’t spin like this as they do on virtually all else with leasehold ‘rights’.
So, without meaningful consumer rights after the fact, where does any ‘campaign’ take existing lessees? Go on a rent strike and be forfeited? Fail to pay service charges and be forfeited?
Carry out alterations without consent and be forfeited?
Law is law and MPs can hardly pretend they don’t know the dogs’ dinner they voted through on many occasions.
Any legal system that can decide that an RTMCo of multiple blocks that had to go to court to get the right is okay whatever the CoA decided as to right to manage multiple blocks, whereas the innocent saps who did not have to go to court because their freeholder accepted their multiple claims is NOT a legitimate RTM company, all using the SAME law, is a legal system I wouldn’t put a lot of faith in.
If leasehold is banned for new housing, this merely blights all existing leasehold houses, surely?
If doubling ground rents are banned for future leases or extensions, this will blight – and already has started to blight – existing leaseholders of flats and houses because lenders wont lend now, surely?
I see nothing so far that actually hurts freeholders? Loads that hurts leaseholders. Shame is not a weapon to employ against a healthy and untouchable bank balance.
It seems there is confidence that the minority government situation will strengthen the cross party move for leasehold reform?
Well I fondly recall the great David Steel getting a private member’s bill supported for homeless reform in 1977. Yes, FORTY years ago. All went well until the committee stages and the wrecking clauses emerged – like local connection and intentionality. Those wrecking clauses are still causing havoc to this day and still we have homelessness rife.
Not many people know this – as Michael Caine might say – but the first homelessness act set out a power (not a duty -goodness no) for LAs to protect possessions of a homeless applicant. I’ll bet another jam sandwich that no LA in forty years has yet to offer to store possessions for a homeless person. We never did in my time.
We MIGHT get leasehold reform. A token reform. MPS will no doubt smack their lips and say, ‘Didn’t we do well, let’s move on’.
But watch for the multifarious wrecking clauses and ambiguities that the property courts will relish to return landlords to what they must always be in this green and pleasant England (and Wales) – unassailable Lords of the Land with more human rights than them smelly tenant sorts. Give ’em a bath and they’ll keep coal in it, after all. Best not give them a bath then.
Off for a lie down – too much sun!
By setting up the so called assistance scheme (which in no way assists anyone but the freeholders) Taylor Wimpey have clearly admitted their responsibility on causing this scandalous situation by mis-selling what we thought would become OUR homes. Any business that publicises their decision to offer any form of compensation would be expected to place their customers in a position that is the same or better than originally promised. Why would anyone accept this sort of compromise? Can anyone please translate into plain English for Mr Redfern that we are not looking for a less onerous clause. We want our freehold as per the promise made to us by his sales representatives. They were quick at parting us from our money at the time. They’d better be as quick at doing something about it now.
Hey Paddy “Too much sun” has turned you into a little ray of sunshine!! Change will come- There is always darkness before the dawn.Leaseholders like lions have risen from slumber and that makes all the difference.
Really thorough and informative article that covers all the issues that all those of us with Taylor Wimpey doubling ground rents are now facing into. It’s scandalous. TW need to provide individual redress and the ground rent Assistance Scheme goes nowhere near far enough. This will be a long fight for fair treatment and redress for all of us involved.
Read Paddys comments. All I can say is, if Scotland can get rid of leasehold then there’s no reason why England and Wales can’t. As the meerkats would say ” simples “
I come from Merekova. I journeyed many days crossing land adriatic and sailing from Harbour Long to escape from poverty as in Mererkova property is also leasehold. Also charges are too much. Just try dealing with Estates & Meerkats! Also, the regularity group Association of Residential Meerkat Agents was not good..
I come to country and buy mansion which is freehold. This is because I want to leave my assets one day to Baby Oleg.
Sergei has been on computermobiles and have discovered many things bad about leasehold. What many peoples believe to be in fact when told by Taylor Wimpey turns out not to be in fact at all!
For leasehold go to ” Compare the scandals dot com” Simples!
Michael your as daft as a brush but you speak good speak i chuckle many a time over your comical comments. (The scurge of peveral you certainly are.)
Enjoyed your reply Michael. It’s just so frustrating to think that things are taking so long to change in this country, when in the rest of the world things have moved on. However in the wake of the Grenfell Tower tragedy I sense that people are finding their voice against a lot of unfair practices, of which Leasehold is one.
I Liddle, My name at the top of the post,yes! But the actual post was written by Alexandr Orlov.