Leasehold Scandal gaining momentum as hundreds take legal action

Leasehold Scandal gaining momentum as hundreds take legal action

Hundreds of leasehold owners in the North West are taking legal action to forcibly buy their freeholds from big investors.

In December 2019, ITV Reports shed more light on the leasehold scandal and the stress it is causing families in the North West. They interviewed Katie Kendrick, a nurse from Ellesmere Port, who is angry at the lack of action in relation to the scandal.

Katie wants to put a ban on new leasehold houses. She also suggested an adoption of Commonhold for all new flats, and compensation to be awarded to the millions of families trapped in leasehold properties.

The leasehold campaign is gaining momentum. MPs have spoken out about the “property trap” and just last month, within the Queen’s Speech there was reference to the Government taking “forward a comprehensive programme of reform to end unfair practices in the leasehold market.”

However, campaigners are angry that there is no mention of help for existing leaseholders, or a timescale for any legislation to be put in place.

You can view the full ITV Granada report here.


What is a Leasehold Property?

In short:

  • Leasehold Property– When a property is bought, but the ground which it is built on is not
  • Freehold Property– When you own the property, and the land on which it stands

The land, when you buy a leasehold property, is owned by the freeholder. The freeholder charges the purchaser ground rent, per annum (every year). The leaseholder also needs to get permission from the freeholder should they want to make any changes to the property.

Leasehold properties are a relatively new trend, as traditionally houses have been sold as freehold. This means we are seeing new-build properties caught in the scandal more than older properties.


What problems are there with leasehold properties?

Problems include:

  1. Many purchasers find that they are unable to sell their properties as some lenders will not grant mortgages on homes which have excessive ground rent clauses;


  1. Historically, the ground rents applicable to a leasehold interest were nominal at best (say £1.00 a year). However, with more and more new developments springing up developers saw an opportunity to profit. They often set ground rents at anywhere between £200 - £400 per annum with a clause that allows them to double this every 5 or 10 years;


  1. Average ground rents are estimated at £371 per year for new-build homes;


  1. Developers charge significant sums for homeowners to alter the original property, to, say, add a conservatory to their property etc.;


  1. The freehold owner can and will sell their freehold interest to another company who will increase the cost of it to make a profit.


What are my next steps if I’m a victim of the Ground Rent Scandal?

If you believe you were mis-sold a leasehold property, Smooth Commercial Law can act on your behalf to ensure you receive the compensation you deserve.

Our three simple steps can get your claim off to the best possible start:

  • We will contact your conveyancer, the solicitor who acted for you when you purchased the property
  • We will retrieve your conveyancing case file, to see if there was any misleading information
  • We will then assess whether you have a case

We will guide you through the process, step-by-step.

You can contact our experienced team by calling 0800 046 9976 or by emailing

For more information on Mis-sold Leasehold Claims click here.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.