"We hope those affected by this update can breathe a little easier knowing they won’t have to struggle against this type of rising fee anymore – particularly when many are already grappling with high costs elsewhere"
- George Lusty - interim executive director for consumer protection and markets
The latest action will see eight additional firms now remove problematic clauses from their leasehold contracts.
The terms, which kick in every 10 or 15 years, can leave people trapped in homes they cannot sell or mortgage, and their property rights can be at risk if they fall behind on payments.
The companies involved, which include investment firms, bought freeholds originally owned by housing developers Countryside, Crest Nicholson, Miller Homes, Redrow, Taylor Wimpey, and Vistry, and continued to use the problematic contract terms at the expense of leaseholders.
All affected leaseholders will now see their ground rents return to the original fee amount – i.e. the amount charged when the property was first sold – and will not increase over time.
Since 2019, the CMA has sought to tackle issues around the possible mis-selling of leasehold homes and contract terms that could break consumer law. Its investigations involving leading housing developers – and businesses who purchased freeholds from these firms have led to landmark changes.
George Lusty, interim executive director for consumer protection and markets, said: “This is another great win for leaseholders. Over the past 5 years, we’ve achieved real and impactful change, with over 21,000 households freed from issues such as costly doubling ground rents.
“We hope those affected by this update can breathe a little easier knowing they won’t have to struggle against this type of rising fee anymore – particularly when many are already grappling with high costs elsewhere.”
