The Competition and Markets Authority (CMA) has been investigating contracts by housebuilders including Barratt, Persimmon, Countryside properties and Taylor Wimpy which lead to ground rent for leaseholders doubling every ten years.
Along with the obvious financial impact this often prevented leaseholders from obtaining a mortgage or being able to sell their homes.
Affected Taylor Wimpey leaseholders will see their ground rents revert to the original amount when the property was first sold. The agreement means the rents will not rise again. Included in this deal are freeholders that have purchased a Taylor Wimpey freehold. They will be compensated by Taylor Wimpey so that their leaseholders will also benefit from ground rent reductions.
Taylor Wimpey agreed to remove the terms from leasehold contracts on a voluntary basis saying it had “always sought to do the right thing”.
The CMA’s investigations continue in a wide ranging review of the leasehold sector. So far Countryside and Persimmon agreed to make changes but Barratt Developments remain under investigation. It remains unclear if Barratt leaseholders will received similar relief.
