Good news for Some Leaseholders but What About the Others?

Posted by Ince on 15th July 2021 -

Housing developer Persimmon and insurer Aviva have both confirmed they are taking steps to address the issues surrounding unfair ground rents that have been subject to investigation by the Competition and Markets Authority since 2019.

Persimmon will allow existing leaseholders to purchase the freehold of their property at a discounted price of £2000.00 under their right to buy scheme and will offer reimbursement of the difference for those who have used the scheme but paid more than £2000.00.

Aviva intend removing unfair ground rent terms from existing leases and will arrange refunds too.

This is great news for leaseholders in property owned by these entities but they account for just a small percentage of leasehold property subject to such ground rent terms. Other leaseholders remain in the precarious situation of having to try to negotiate a resolution with landlords or sit in hope that other landlords follow Persimmon and Aviva or indeed that the government's vague plans for reform come to fruition at some point in the future.

Residential leaseholders of course have statutory rights that can assist them in acquiring the freehold, such options do require financial recompense to the landlord so not always a commercially viable option.

Persimmon and Aviva’s announcement is certainly a step in the right direction but the position remains that the efforts to achieve a fair balance in the protection of property rights for both leaseholders and freeholders will continue and be used to gain favour by politicians for some time yet.  

Persimmon and Aviva’s announcement is certainly a step in the right direction but the position remains that the efforts to achieve a fair balance in the protection of property rights for both leaseholders and freeholders will continue and be used to gain favour by politicians for some time yet.  

{Two big players in the leasehold sector have agreed to change the way they operate, following an investigation by the competition watchdog.

 https://www.bbc.co.uk/news/business-57578060