Can I make a claim about being mis-sold a leasehold property?

Have you got a question?

Generally, leasehold properties were those with communal areas such as flats and apartments, however, there has been an increase in new build houses being leasehold.

What is a leasehold?

Leasehold ownership is a legal agreement with the landowner to own the property for a fixed period. Usually, you pay an annual ground rent and service charge.

Why is there a problem with owning a leasehold property?

There are a couple of key areas that need to be reviewed prior to buying a leasehold property. First is the length of the lease. Typically leases range from 99 to 999 years. If this is shorter than that period then the leaseholder may be forced to pay thousands to lengthen the lease, often needing to pay for the freeholder’s legal fees.

The second is the ground rent. Under some terms the leaseholder may have a small ground rent that increases over the years. Rent may have started at a couple of hundred pounds per year but ends up at several thousand.

Further, on older properties, they may not be able to find the freeholder. Therefore, homeowners are left in limbo, unable to buy the freehold, sell or extend their lease causing more pain and stress.

What have the government done to help?

The government announced the Leasehold Reform (Ground Rent) Bill, which stops the overcharging of ground rent for new and qualifying long residential leasehold properties. Further, it prevents the freeholder from charging administration fees.

What can be done?

When buying a property, you usually use a solicitor or conveyancer. This person should advise you of the issues of buying a leasehold property. They often add an additional leasehold fee into their charges to check the lease. However, if they fail to outline the financial implications of various clauses in the lease then it could be considered professional negligence. 

If you believe you were not advised properly about your leasehold property purchase then get in touch with our claims team on 020 3051 5060. 

 

Ben Lockyer

Ben is the business development manager for the firm. He has years of experience building relationships with commercial partners.

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