28 Feb Buy Freehold Only
I believe that when a customer buys one of our homes that they should be able to enjoy it, worry free for as long as they want. This means that we will sell the freehold of a property – which gives the owner as many rights as possible. Further than that where there are common areas, such as an entrance road, we will transfer the ownership of those areas to a management company which is owned by the property owners. This means that the owners control their own costs and have a share in a larger freehold which adds to the value of their property.
The background to this declaration is that an investigation by the Competition and Markets Authority (CMA) has found “troubling evidence” that leasehold homeowners and prospective buyers were being misled and charged excessive fees by developers. They said it would do everything it could to help people who find themselves in “serious traps”.
Andrea Coscelli, the chief executive of the CMA, said: “We have found worrying evidence that people who buy leasehold properties are being misled and taken advantage of. Buying a home is one of the most important and expensive investments you can make and once you’re living there you want to feel secure and happy. But for thousands of leaseholders homeowners, this is not the case.”
The lengthy CMA investigation identified a range of abuses including homeowners having to pay escalating ground rents, which in some cases are planned to double every 10 years, meaning people can struggle to sell their homes.
The CMA also found that some prospective leasehold homebuyers had been misleadingly told it is cheap to convert a leasehold to freehold, only to find that the actual cost had increased by thousands of pounds, with little or no warning.
Some housing developers were found to be giving misleading information to buyers about issues including the difference between leasehold and freehold, with some claiming there was no difference. That has resulted in some homebuyers trapped paying extra charges that come with leasehold ownership.
The CMA said that its investigation supports the case to make changes to the law in this area. The government has already announced a crackdown on the sector to tackle a range of abuses. In late 2017 the government confirmed it was putting a stop to the sale of new leasehold houses in England and a consultation on other measures ended in November 2018.
Warm Beautiful Homes stands for clarity in the home buying process. We want our customers to understand their property and enjoy the ownership. We go out of our way to impose as few restrictions as we can. The sale of leasehold properties is difficulty to justify and often traps the owner because no lender will raise a loan on the property. We deplore this situation – which is why we will only sell properties on a freehold basis.