Campaigners against Ellesmere Port’s leasehold houses travelled to Manchester to stage a demonstration.

Activist Katie Kendrick and others from the town’s National Leasehold Campaign travelled to the First Time Buyers Show in Manchester to increase awareness of the pitfalls of leaseholds to first time buyers.

The campaign argues thousands of families have become ‘prisoners in their own homes’ after being mis-sold leasehold properties with onerous ground rents and permission fees. Many of these homes had been bought through the Government’s Help To Buy Scheme.

It points out that in July, the Nationwide Building Society and other lenders refused to offer mortgages on new build properties with ground rents in excess of 0.1% of the property value.

Katie said: “Our demonstration aimed to show the dawn of the new reality facing thousands of families in England and Wales and to highlight the terrible consequences of the recent leasehold abuses, in particular how young families and first-time buyers have become trapped as prisoners in their own homes by oppressive leasehold contracts designed by greedy developers and freeholders.

“The Government recently announced an additional £10bn for Help to Buy. We want to make sure that this money is not used to fund more leasehold homes.

Campaigners from Ellesmere Port's National Leasehold Campaign who highlighted problems at a demonstration in Manchester
Campaigners from Ellesmere Port's National Leasehold Campaign who highlighted problems at a demonstration in Manchester

“However, this is not only about ground rents, we need to alert unwary first-time buyers about leasehold in general and recent abuses that have blighted thousands of ordinary families many who bought using the government’s Help To Buy Scheme.

“There are millions of victims most of whom don’t even realise they are part of this scandal yet.

“People buy a home thinking they own it yet in the eyes of the law they are only a tenant. Leasehold tenure needs to be assigned to the history books and abolished once and for all for both flats and houses.”

The campaign says major developers including Taylor Wimpey, Bellway, Redrow and Persimmon have been selling houses as leasehold and selling the freeholds on to third party investment companies without the homeowner’s knowledge as an additional income stream for the developer.

In many cases those homeowners were promised they could buy their freehold for a nominal sum after two years only to find that they had already been sold on with the new freeholders demanding ‘extortionate amounts’ that can exceed £30,000 to sell the freehold back to homeowners, the campaign argues.

In anticipation of the outcome of a recent Government consultation that is expected to ban the sale of leasehold new build homes, developers are said to be already moving to advertising properties as freehold but keeping many of the covenants and permission fees typically associated with leasehold properties, something the National Leasehold Campaign is calling ‘fleecehold’.

Taylor Wimpey has recently set aside £130m to deal with the problem, according to the campaign, with one freeholder offering to change some doubling ground rents to rise in line with the retail price index. But critics feel this is simply a PR exercise to keep the status quo.

Campaigners from Ellesmere Port's National Leasehold Campaign who highlighted problems at a demonstration in Manchester
Campaigners from Ellesmere Port's National Leasehold Campaign who highlighted problems at a demonstration in Manchester

Fellow campaigner Jo Darbyshire added: “Freeholders and developers have gone one step too far, their increasing greed has derailed the gravy train and they want it back on track by tossing some crumbs to leaseholders.

“Ground rents are only part of the problem with management fees, permission fees, an unfair leasehold tribunal system and a range of other charges.

“The system is rotten to the core. I hope that the outcome of the Government’s consultation on tackling unfair practices in the leasehold market will bring a ban on the sale of leasehold and ‘fleecehold’ new homes.

“I want to see a full review of the mis-selling of leasehold homes, similar to those that we’ve seen for pensions, PPI and endowment mortgage mis-selling and full redress paid to those of us that have been caught up in this nightmare.”

Action by the Government to crack down on unfair leaseholds was welcomed in the summer by campaigning Ellesmere Port and Neston MP Justin Madders (Lab) who has been backing residents in the town who have discovered they have problems with the leaseholds on their houses.

Commenting following a Government announcement intended to deliver a fairer, more transparent system for home buyers, Mr Madders said: “I am extremely pleased that some significant proposals are finally being produced to tackle abuses in the leasehold sector which have brought misery to thousands of people.

“This has to be considered as a significant step in the right direction. Although it is a consultation at this stage, it is to be hoped that the house building lobby do not see this as an opportunity to put obstacles in the way of progress.”

He continued: “Clearly there are question marks over how far this will go towards assisting people who have already bought their homes, face onerous ground rent clauses and have been quoted extortionate sums to buy their properties, obtain permission to alter the property or even ask a question of their landlord.

“What has occurred in this sector should be regarded as a national scandal.

“Once we have taken action to drive out these rotten practices, the ultimate aim must be to hold to account the men and women who must have known that creating this second lucrative income stream for developers would ultimately be at the cost of their customers.”

The outcome of the consultation, which closed in mid September, is awaited. “It is a step in the right direction but it’s a long way from fixing what is already broken,” Katie believes.