TV presenter Phil Spencer has savaged new homes builders for continuing to sell leasehold houses despite the recent miss-selling scandal that rocked the construction industry.
His property advice site MoveIQ says its research shows 2,600 leasehold houses have been sold since the government announced it would introduce a ban a year ago. The revelation is shocking because many of these houses are being sold via the tax-payer funded Help to Buy scheme.
MoveIQ says Land Registry figures show 26,024 new-build properties have been sold with leaseholds since last December’s government announcement, 2,644 of which were houses.
And data from the Ministry of Housing, Communities and Local Government shows that during the first six months of 2018, nearly 6,000 leasehold homes were bought with assistance from the Help to Buy scheme, of which 1,340 were houses.
Buyers can face crippling financial problems after they move in. This includes huge ground rent increases and finding they are unable to sell their homes while some are charged large sums to make even minor changes to their homes.
Earlier this year the NAEA conducted research that found a third of those who had bought leasehold houses had subsequently struggled to sell them.
In October a group of 500 newbuild property owners instructed a leading law firm to seek compensation over their mis-sold leasehold apartments and houses.
After announcing its intention to ban such sales a year ago, the government is due to announce plans to tackle the problem, along with other leasehold reforms, following a consultation that ended last month.
“A year on from the Government’s pledge to ban the sale of new build leasehold houses, thousands of buyers are still being allowed to sleepwalk into leasehold limbo,” says Phil Spencer.
“And in a further, ironic twist, many are even being encouraged to do so by the Help to Buy scheme.
“When the ban comes in, there should be some redress for the thousands who have bought leasehold houses. At the very least they should be given first refusal on the freehold of their home at a reasonable rate, before it is sold on to a third party.”