For some of my Chelmsford constituents, these provisions cannot come soon enough. One constituent told me how he bought his leasehold flat seven years ago, but now he and his wife want to move to a bigger home to start a family and progress their lives. For the past three years, they have been unable to sell their flat. They have tried listing the property with many different estate agents and had many offers, but no buyer can get
a mortgage on the property due to a clause in the lease that means the ground rent can be doubled every 15 years. According to my constituent, nobody in this block of 20 flats has been able to sell a property since 2018. They feel stuck.
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Another constituent in another block of flats says that her family of three and a dog have been trying to move out of their one-bedroom flat for more than two years. Because the ground rent exceeds the £250 arbitrary threshold set for properties outside of London, buyers cannot get a mortgage, because if a leaseholder were to default on the ground rent, the landlord would have the right to repossess. The family have tried deeds of variation, indemnity policies and multiple mortgage lenders, all to no avail. Mortgage companies value the flat at literally zero.
For most people, buying one’s own home is meant to give security and stability, choice and freedom, but for these leaseholders, life is more like being locked in a time warp. They are trapped in a prison of their own property, unable to move on. I therefore welcome the measures in the Bill and the amendments that the Government have tabled today. I have listened carefully to what my hon. Friend the Member for Walsall North (Eddie Hughes) and others have said about forfeiture and what the Minister said about caps on ground rent. The Minister needs to go further on this issue.
Another group of leaseholders are struggling live in Kings Tower, a 12-storey building with a small amount of combustible insulation on the spandrel panels on the outside of the building. It might need remedial work to remove and replace it. I think it is shocking that seven years after Grenfell Tower, a huge company—Barratt—and the property management company, Estates and Management Ltd, have still not carried out this remediation work.
One of the leaseholders, Richard, emailed me today. He said that back in 2009, the service charge was just £800 a year. This year, he thinks he will have to pay £4,000. Richard and other leaseholders were first told of the potential issue in August 2020. He says that since then, they have been unable to fulfil any form of normal life, due to these additional fire safety issues and the cost. He says:
“I genuinely feel ill to think of what our service charge demand is going to be in March this year”.
As well as increases in insurance, Barratt and E&M Ltd are blaming the increase on the costs needed to register the building under the new regulations of the Building Safety Act 2022. I thank the Minister for his letter to me on this subject. Even though paragraph 9 of schedule 8 was meant to protect leaseholders from the costs of legal and other professional services, it is clear that my constituents and many others feel that they are being gouged for excessive costs.
Finally, some freeholders also face issues. There are some truly stunning residential developments in Chelmsford, where the parks and public areas are beautifully maintained by estate management companies, but that is not universal. I note that FirstPort has been named by my neighbour, my right hon. Friend the Member for Witham (Priti Patel), as a company that is particularly difficult to deal with, even for a Member of Parliament, and I agree with her.
It is so hard for freeholders to hold management companies to account and to ensure that maintenance is done well and that the costs charged are reasonable. I am therefore glad that this Bill will also include measures to give freeholders access to support via redress schemes and to require estate management companies to be transparent. When more leaseholders become freeholders—as I truly hope they will thanks to the changes brought in by this Bill—we need to ensure that these terrible practices are not just passed on to freeholders, but that freeholders also have these rights and the ability for redress.