WARRINGTON South MP Faisal Rashid has accused a developer building homes in his constituency of “mis-selling leasehold properties” to local people.
Mr Rashid raised the issue during Parliamentary Business Questions in the House of Commons.
He highlighted issues faced by residents of Steinbeck Grange, Chapelford – built by David Wilson Homes – and called for a debate to discuss compensation for existing leaseholders trapped in unfair and exploitative contracts.
Leader of the House Jacob Rees-Mogg recommended Mr Rashid to apply for a backbench business debate on the issue and he has since agreed to do so.
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.
Mr Rashid said figures have revealed that an estimated 47.84 per cent 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.
Labour have proposed a ban on the sale of new leasehold houses and flats., he said. Under Labour, leaseholders will be able to buy the full freehold ownership of their home for 1 per cent of the property value, with ground rents in existing leaseholds capped at 0.1 per cent of the property value, up to a maximum of £250 a year.
The MP said: “A number of my constituents in Steinbeck Grange, Chapelford have been mis-sold leasehold properties by David Wilson Homes and face rip-off ground rents, punitive management fees and unfair contract conditions.
“Government action on this issue is unacceptable. Proposals have been brought forward to avoid future leasehold rip-offs, but nothing is being done for those already trapped in these onerous and exploitative contracts.
“I will continue to fight on behalf of my constituents in Steinbeck Grange, who I believe deserve compensation. Time is up on excessive ground rents and service charges which rip off hard working people.”
Warrington-Worldwide has contacted David Wilson Homes but has not received a reply