March 25, 2017

Telegraph reports surge in leasehold newbuilds

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TelegrapharticleREDONEA good article in the Telegraph about leasehold newbuild flats being on the rise.

They make up 43pc of all newbuild registrations with the Land Registry, compared with 22pc in 1996.

While leasehold newbuild flats were up by roughly 10,000, leasehold houses also sharply increased: registrations of newbuild detached leasehold houses more than doubled in 2015 to 2,829.

Persimmon has being doing a lot of this in Peterborough, as reported in the Daily Mail here

Sebastian O’Kelly, a director of Leasehold Knowledge Partnership, is quoted saying: “We are producing huge swathes of new leasehold homes. Older people are being encouraged into retirement flats, but these are nearly all leasehold.

“First-time buyers in flats and houses are being caught. Elderly and novice buyers are being forced into a tenure they do not always understand and where they have few rights.”

The truth of the matter is that given the huge advantages of leasehold to create sustained revenue streams, it is bound to grow.

Doubtless, housebuilders would like nothing better than to turn all the British people into tenants, embed long-term revenue streams and then flog the freeholds to offshore entities.

We need to stop them doing this.

Comments

  1. The last line of the above post is so true:

    “Doubtless, housebuilders would like nothing better than to turn all the British people into tenants, embed long-term revenue streams and then flog the freeholds to offshore entities. We need to stop them doing this.”

    And the above statement applies not only to leaseholders but also to the kind of strange “Freehold” that many house-owners are purchasing today in the UK. Even solicitors are not picking up on it.

    UK housebuilders are succeeding in turning Freeholders into tenants. Freeholders are being made beholden to the housebuilder by way of a service charge to cover “common areas” on a development, and by way of other conditions being set out in covenants.

    It’s very crafty. And the housebuilders are literally getting away with it because the people moving into such developments just want an easy life and to be “nice”. They don’t want to rock any boats.

    “Yes, yes, Mr. House-Builder, we believe you, we trust you.”

    The only thing to do is for Freeholders and Leaseholders on such developments to united and force the housebuilder to hand over the Freehold of the common areas.