Following a recent investigation carried out by the Competition and Marketing Authority (CMA) into what could be considered to be unfair Ground Rent clauses in Leases, we have compiled some information relevant to The Vibe Leaseholders.
As part of the investigation, the CMA consulted with a number of housing developers including Countryside Properties who were the developers for The Vibe. The CMA’s particular concern around the potential unfairness of terms that double ground rent more frequently than every 20 years, including any such clause which was in a Lease and has been varied to refer to a different rate of escalation (e.g. RPI), were raised and developers were asked to take steps to address these. It is recognised that often lenders will not grant borrowing against a property with such Ground Rent review clauses and could potentially result in Leaseholders struggling to sell or mortgage their homes. Further information regarding the investigation carried out can be found on https://www.gov.uk/cma-cases/leasehold#investigation-launch
As Great Places Housing Association (GPHA) acquired the Freehold title of The Vibe development from Countryside Properties, it has been agreed and GPHA have given their commitment to offer to remove the clauses which caused the ground rents payable by leaseholders (at the Vibe) to double in price every fifteen years. This commitment will also include the removal of terms which were originally doubling clauses but were converted into RPI-based ground rent terms. The variation to the Lease will ensure that the ground rent for affected leaseholders will remain at the amount it was when the property was first purchased (and / or varied) and will not increase over time.
In order to apply the variation to remove review clause from the Lease, GPHA have communicated with an independent firm of Solicitors as detailed below who have the knowledge and experience required in conveyancing and would represent Leaseholders as the client to ensure that the variation is applied and registered accordingly. As part of our commitment, we have agreed to pay legal costs to a cap of £750 per Leaseholder (inclusive of vat) and the below firm has confirmed that it can carry out the work required within that £750 cap. Of course, Leaseholders can if they wish to do so, appoint their own solicitor to act on their behalf and the £750 cap (inclusive) would apply equally in that situation.
Solicitor Details: Direction Law
Contact: Sebastian Paolo
Telephone: 01227 812734
Once the offer of variation is accepted by yourselves as Leaseholder, GPHA will use all reasonable endeavours to effect the variation without delay. If you wish to accept this offer please email email@example.com.