‘Don’t trust builders to end rip-off lease­holds’

Daily Mail - - City & Finance -

HOUS­ING de­vel­op­ers can­not be trusted to fix the lease­hold scan­dal that has left tens of thou­sands of fam­i­lies trapped in un­sellable homes, min­is­ters have been told.

in a deal with the Gov­ern­ment, the UK’s big­gest builders last week agreed to help vic­tims strug­gling with rip-off leases.

But MPs have warned min­is­ters the agree­ment puts too much faith in com­pa­nies that ‘cre­ated this cri­sis’ and urged them to be tougher.

Un­der the vol­un­tary deal, de­vel­op­ers agreed to change con­tracts where fam­i­lies are stuck with ground rents that dou­ble more of­ten than ev­ery 20 years.

in­stead, these rents would rise in line with the re­tail price in­dex (rPi) mea­sure of in­fla­tion, they promised. But cam­paign­ers and MPs ar­gue the deal will still leave house­holds with oner­ous leases that rise ev­ery year.

Clive Betts MP, chair­man of the hous­ing com­mit­tee in the House of Com­mons, said the vol­un­tary pledge would still leave tens of thou­sands of lease­hold­ers stuck paying ‘un­rea­son­able’ fees.

the Mail has led the way in ex­pos­ing the scan­dal, with as many as 100,000 fam­i­lies thought to be trapped in un­sellable homes.

in a letter to Hous­ing Sec­re­tary James Bro­ken­shire, Betts said: ‘We are con­cerned the Gov­ern­ment ap­pears will­ing to place a sig­nif­i­cant level of trust in the same in­dus­try that cre­ated oner­ous leases. the Gov­ern­ment should not al­low free­hold­ers and de­vel­op­ers to con­tinue to charge oner­ous ground rents of any kind, in­clud­ing those that in­crease over time by rPi.

‘Weak in­dus­try pledges are not good enough. More fun­da­men­tal re­form is re­quired.’

Betts said a vol­un­tary deal should be tem­po­rary, and called for sharply ris­ing ground rents to be banned.

Jo Dar­byshire of the na­tional Lease­hold Cam­paign said: ‘it’s time for Gov­ern­ment to take a much stronger stance and avoid be­ing taken in like Lit­tle red rid­ing Hood as the lease­hold wolves dress up like Granny. We’ve seen de­vel­op­ers post­ing ob­scene prof­its. they can af­ford to do the right thing, they choose not to.’

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