WARRINGTON South MP Faisal Rashid is backing new plans to bring justice to constituents affected by the leasehold scandal.
A recently released Labour report includes proposals to cap unfair costs such as ground rents, investigate mis-selling and save local leaseholders thousands of pounds.
Leasehold ownership, most commonly found in flats, means purchasing a home for the duration of a long lease rather than owning it outright. Homeowners who purchase a leasehold property are often faced with extortionate charges in the form of ‘ground rents’ or service charges and are locked into restrictive contracts which were not properly explained.
New figures show an estimated 47.84% of homes in Warrington South were sold as leasehold last year. Leasehold reforms promised by the Conservative Government have still not been implemented, two years after they were first proposed.
The plans, set out in a consultation by Labour’s Shadow Housing Secretary, John Healey MP and Shadow Housing Minister, Sarah Jones MP, include a ban on the sale of new leasehold houses and flats. Leaseholders will be able to buy the full, freehold ownership of their home for 1% of the property value, with ground rents in existing leaseholds capped at 0.1% of the property value, up to a maximum of £250 a year.
Labour’s proposals mean the average household in Warrington South would see their annual ground rent capped at £200, with the cost of buying their freehold reduced to just £2,000 – according to analysis published by Faisal Rashid MP.
Other proposals set out by Labour include:
- A crack down on unfair fees and contract terms, and a right to challenge unfair fees or poor service.
- New rights to empower leaseholders to hire and fire their managing agent, or to take over management of their homes themselves.
- A promise to revitalise commonhold: an alternative to leasehold – forms of which are used successfully across the world.
The report also renews Labour’s calls for a full public inquiry into mis-selling in the leasehold market which saw thousands of properties sold with extortionate terms such as doubling ground rents, making them unsellable.
Faisal said: “I am proud to support Labour’s plans to end the feudal leasehold system, saving home-owners thousands of pounds and breaking the stranglehold that developers and freeholders have on millions of families trapped in leasehold homes.
“This is an issue which has affected many of my constituents. At Prime Minister’s Questions last year, I challenged Theresa May to tackle this issue urgently. Unsurprisingly, we have seen very little action from her incompetent Tory Government since.
“As this announcement demonstrates, only the Labour Party has a plan to help homeowners on ordinary incomes trapped in unfair leasehold contracts, saving families and home buyers thousands.
“Time is up on excessive ground rents which rip off hard working people. Labour will improve and revitalise commonhold for flats, and make freehold mandatory for all new houses, as the Conservatives should have done years ago”.