Thousands more leaseholders are to get money back

Further action by the Competition Markets Authority (CMA) will see leaseholders who paid a doubled ground rent receive a refund and nine more companies will remove these costly terms from leasehold contracts.

The companies that bought freeholds from housing developer, Taylor Wimpey must now remove problematic contract terms that cause ground rents to double in price every ten years, which can lead to people being trapped in homes they cannot sell or mortgage.

The businesses that purchased freeholds from Taylor Wimpey and provided undertakings are:
    • BDP Freehold Limited
    • Mortgage Incentive Funds Limited
    • The Bridges (Darlington) Management Company Limited
    • Bessant Properties Limited
    • Brigante Properties Limited
    • Furatto Limited and Long Term Reversions No 1 Limited
    • SF Ground Rents No18 Limited, SF Ground Rents No 15 Limited and RMB 102 Limited
    • Sarum Properties Limited
    • Taylor Court Limited
The businesses that purchased freeholds from Taylor Wimpey who have not provided undertakings yet are:
    • Island Apartments Freehold Limited
    • Madison Close Freeholders Limited
    • Elmdon Real Estate LLP
    • Abacus Land 1 (Holdco 1) Limited, Abacus Land 4 Limited and Adriatic Land 1 (GR3) Limited (part of the Abacus Land and Adriatic Land investment group)
    • Plaza 2 Surbiton Limited

A further four national developers – Crest Nicholson, Redrow, Miller Homes and Vistry – have also agreed to work with the companies who purchased their freeholds to remove doubling terms.

Ground rents

All affected leaseholders will now see their ground rents remain at the original amount – i.e. when the property was first sold – and this will not increase over time. The nine freeholders have also agreed to refund residential leaseholders who had already paid out under doubled ground rent terms and remove contract terms which were initially doubling clauses but were converted so, the ground rent increased in line with the Retail Price Index (RPI). The original doubling clauses were unfair and should therefore have been fully removed – not replaced with another term that still increases the rent.

 

This action brings the total number of homeowners that have benefitted from the CMA’s investigation to over 20,000 after starting their investigations in 2019.

 

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