Thousands of families are trapped in homes they can’t sell because of doubling ground rent clauses
One family has been pushed into £20,000 worth of debt because they can't sell-up
MILLIONS of people may be trapped with leasehold properties they can't sell or remortgage because of questionable doubling ground rent clauses.
According to the Government, around 4.3million homes - both flats and new builds - in England are leasehold.
It's not clear how many people this affects but Housing Minister Heather Wheeler recently suggests it is between 12,000 and 100,000.
And around 14,000 people have joined the , which calls for leasehold to be abolished.
And a survey by estate agent trade body NAEA found that almost half (48 per cent) of homeowners were unaware of the escalating ground rent.
'We were never told about the doubling ground rent'
Sarah, 40, and Gene Sisley, 45, from Hayle in Cornwall say they were never told that the brand new flat they bought for £117,000 from Taylor Wimpey in 2009 had a doubling ground rent clause.
The aim is to convert leases so that rather than doubling every ten years, they rise in line with the retail prices index (RPI) measure of inflation.
This is likely to mean lower increases than at present (RPI is currently 2.7 per cent), although RPI is still typically much higher than other Office for National Statistic inflation measures.
Taylor Wimpey says it has agreements in place to convert 95 per cent of its leases but only £25.5million of the £130million it set aside had been paid out by December 2018 - the most recent figures available.
The Government meanwhile, has been consulting on a shake-up to the leasehold system since 2017 and has promised to ban leaseholds on new properties.
But this doesn't help those already with a leasehold home - an issue it's still looking into alongside the Law Commission.
Sarah joined Taylor Wimpey's deed of variation scheme in April 2018 but a year later the house builder says it's still negotiating with the freeholder.
'Taylor Wimpey should be helping people'
Sarah believes she was "mis-sold" to. She said: "Taylor Wimpey did this in the first place by mis-selling. It's wrong.
"I still feel it’s up to Taylor Wimpy to be helping people and to sort it out. And I think legislation should go through to reform leasehold."
The Housing, Communities and Local Government Committee called earlier this year for an investigation into the mis-selling of leaseholds and for compensation to be paid to those who've been deliberately misled.
A spokesperson for Taylor Wimpey added: “We are very sorry about the difficulties facing some of our customers as a result of their ten-year doubling lease terms and will not walk away from this.
"Our objective remains to work through this process fairly for our customers, to convert their ten-year doubling leases to an alternative structure that addresses the issues of affordability, mortgageability and saleability.
"We are working hard to reach similar agreements with the remaining, and very small number of freeholders, to enable us to do this.”
Both the freeholder and the management company failed to respond.
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