10:55 AM, 22nd December 2016, About 5 years ago 6
Gavin Barwell was speaking at a debate on the Leasehold and Commonhold Reform Act of 2002 and said the leasehold system has widespread problems that need addressing and produced results of the National Leasehold Survey 2016, which showing 57% of leaseholders agreed with the statement “I regret purchasing a leasehold property”.
Housing Minister Barwell went on to say, “The Secretary of State and I have been looking closely at the issues raised in recent weeks and I can tell the House that we are both absolutely determined to stamp out unfair, unjust and unacceptable abuse of the leasehold system.
“I most certainly do not feel comfortable with that level of concern right across the country. I am very keen to explore how we can promote greater transparency and fairness, and to work with all interested parties to improve leaseholders’ experience of home ownership.”
Figures published by Which? in 2016 estimated leaseholders had been overcharged by £700m a year.
However, Sebastian O’Kelly, of the Leasehold Knowledge Partnership confirmed it was difficult to verify the amount leaseholders are being overcharged, but that £700m was likely to be an underestimate.
O’Kelly said, “The number of leasehold properties has doubled since 2007. Millions of pounds are in dispute because of predatory management. There are numerous court cases and Office of Fair Trading investigations. If leaseholders aren’t in control of their own block they’re not in charge of costs”.
Currently Freeholders can add their own legal costs to service charges discouraging leaseholders from challenging unfair charges. Gavin Barwell confirmed that new laws coming into force from next year would enable courts to prevent the landlord passing on the legal costs if the leaseholder objects.
Managing director of Leasehold Solutions, Louie Burns said, “it is fantastic to see that Parliament is waking up to the deplorable scandal of the UK’s feudal system of leasehold. We have been campaigning for years to raise the issue of leasehold on the political agenda and to educate flat owners about their rights.
“I hope that the Government will work to bring about timely and meaningful changes to improve the lives of the UK’s 4.1m leaseholders. Abuse of the leasehold system is a growing problem; 43% of all new properties in 2016 were built as leasehold homes, so without urgent action increasing numbers of flat owners will continue to be exploited for profit by unscrupulous freeholders.”
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