Leasehold Questions

As many of us know, here in the North West, and in Leigh in particular, we are suffering from the growing leasehold crisis. And we are particularly susceptible to the crisis locally as consequence of the role in which the area played in the industrial revolution.

Historically, land was often sold by the church to build terraced houses for factory workers, but the landowners wanted to retain an income from their land and therefore created long leases, usually for 999 years and set ground rent at a few pounds a year.

This rent continued for decades until recently when companies began purchasing the land from builders, rent began to increase, and fees began to rise. In the last 5 years this has escalated out of control with rents reaching sometimes more than £250 with some clauses doubling the rent each year. New housing also sometimes includes management and maintenance fees on top, creating a completely unsustainable, unfair housing market in post-industrial towns such as ours.

With ground rent set to hit the thousands within a few years, despite residents owning their own home, the Government conceded that they needed to take action and last year announced a ban would be introduced on new leaseholds charging more than a peppercorn rent as has been the norm for decades.

This was a welcome step forward, but it offered nothing to the thousands of homeowners caught in these long leases which are still set to double year on year. I’ve heard from families caught in this leasehold trap increasingly unable to afford their ground rent on top of their mortgage payments. It is completely unacceptable and in need of urgent intervention.

However, this week the Government announced that they would be pausing their plan to ban these practices and instead launch a consultation.

I can say to the Government quite clearly, we do not need a consultation. The injustice of the scandal and the pain it causes is clear to see, we instead need action, not just to ban these practices but offer assistance to those who are already caught in the crisis.

Labour recognises the urgency of the crisis and has called on the Government to bring forward legislation before Christmas which will allow homeowners to inexpensively purchase the freehold, unleashing themselves from this trap. We have made this offer to support any measures to this effect and hope that Conservative MP’s in Parliament will also be willing to vote for a remedy to this crisis.

Urgent questions must be answered by the Government on why they are so inactive and complacent about leaseholds, especially when they are clearly impacting regions such as ours so heavily. I will continue to apply pressure in Parliament, calling for a cross-party effort to make this small remedy to our broken housing market which too often only works for the few at the cost of the many.

Last modified onThursday, 18 October 2018 15:33
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