The Doubling Ground Rent Scandal - What Can You Do?

Robert Godfrey
Partner, Head of Professional Negligence and Dispute Resolution

Buying a house is one of the biggest financial purchases a person will ever make in their lifetime. So what can be worse than finding out you don’t actually own the house, or even if you did know this, that there are clauses which may make it harder to sell the house at the price you paid?

What Can You Do?

You may be able to claim compensation to put you back in the position you would have been but for the failings of the Solicitors you hired. Although there may be no redress against a developer, there may be redress against the Solicitors you paid to carry out the Conveyancing. You put your trust in professionals to do a good job and, importantly, to advise and protect you. So if they’ve let you down, you should be able to act.

We’ve identified a number of cases where a lease contains a ground rent clause which doubles every 10 years up to a maximum of 50 years, and the Solicitors who were instructed to represent the buyer failed to properly identify it or point out the adverse effects this may have on the property.

If you’ve been affected like this, there may be a potential claim to be brought against the Solicitors who you hired. For free legal advice, get in touch with our Professional Negligence Solicitors. Ask if we can deal with your claim on a No Win, No Fee basis.

Call us on 0808 239 9426 or request a callback

The Leasehold Properties and Ground Rent Scandal

Effectively, a leasehold property is not yours to own for the rest of your life, unlike a freehold property. Although you may have paid a considerable amount of money buying the house, the reality is that if it’s a leasehold property, you’re simply renting it for the period of the lease.

So on expiry of this period, the house will return to the freeholder, who is simply the landlord and you’ve got nothing to show for the money you spent.

The lease period can vary from 120 years to 999 years, but importantly, you may find that as well as not truly owning the property, you also have to pay a ground rent every year, which in a lot of cases for new builds over the last 15 years, may be £250 a year or more. And it’s not uncommon for this to double in price every ten years.

Can I Buy the Freehold?

You’re entitled to buy the freehold after you’ve owned the property for two years, and there’s a calculation which is utilised in working out how much it may cost you. But this will begin by looking at the annual ground rent and terms of years over which it would be paid.

This can be very expensive and freeholders will use a number of tactics and arguments to ensure they receive the maximum price possible. The issue is that these onerous rent clauses may well impact on the value of the property and, in some instances, make the property unsellable.

For free legal advice call our Professional Negligence Solicitors

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