An MP has lent his support to a parliament campaign which seeks to “end exploitation” of leaseholders.
Gareth Thomas, MP for Harrow West, has given his backing to a group of residents who purchased homes in the Harrow View West development on a leasehold basis.
They argue that subsequent properties were sold as a freehold – meaning they own both the property and the land – for the same price or even less.
Persimmon Homes, which was responsible for the development, attributed the situation to changing circumstances.
A spokesman added that it was working with some residents with regards to the purchase of freeholds.
He said: “We have been in discussions with a small number of residents to confirm to them that they may purchase the freeholds after a two year period of ownership, and that Persimmon is committed to retaining ownership until then.
“As a result of changing market conditions, the later phases of the development have been sold as freehold.”
Mr Thomas noted that since leaseholders do not own the land their properties sit on, they take out a lease and are charged ground rent by the freeholder.
Ground rent costs can escalate quickly, and many developers have sold the freehold onto third parties meaning leaseholders can find it difficult to track down the true owner of their property.
He said: “Home ownership is increasingly a pipe dream for many people, so it is even more disappointing to see that those who do manage to purchase what they believe will be their dream property are being let down by developers.
“It is clear that property developers around the country have been exploiting the current law on leasehold, and using uncertainty around these practices to squeeze as much as they can out of hardworking homebuyers.
“I’m fighting in Parliament for a fair deal for leaseholders, but in the meantime I hope Persimmon will recognise the unfairness in their dealings with the residents in Harrow View West and come up with a satisfactory solution.”
He explained how residents were assured that the entire site would be sold leasehold to retain the development’s aesthetics.
He added that many were first time buyers who were not warned of the full consequences of purchasing their homes on a leasehold basis, or feel that important details were not given until they has already spent significant sums ahead of final exchange.
Mr Thomas has lent his support to a new Bill that would introduce a maximum charge for leaseholders to purchase the freehold, end the unfair practice that sees leaseholders pay the legal costs of freeholders in tribunal cases, and establish a compensation scheme for cases where leaseholders were misled by property developers.
He has also written to the chief executive of Persimmon Homes, calling on them to “end this unfairness” and ensure that all homebuyers at the Harrow View West site are given equal access to the freehold on their properties.