UK Housing market: why the leasehold scam must end | Economics | the New Statesman podcast
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- Опубликовано: 4 мар 2024
- "Crook" landlords are cheating the UK housing system to scam leasehold homeowners out of extortionate rent and service charges, says Barry Gardiner MP.
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There are five million leaseholders in the UK who own the space within their home but not the walls, roof or land their property is on. Barry Gardiner MP has been campaigning for over 20 years for new laws to abolish leasholds, and he joins the New Statesman podcast to explain how many homeowners are trapped by "crook" landlords into paying extortionate fees for homes they can't sell.
Gardiner joins Anoosh Chakelian and Rachel Cunliffe - both current or former leaseholders themselves - on the New Statesman podcast to discuss what the government must do.
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Fiat currency is the biggest ponzi scheme going. Let's go onto the silver standard instead.
This is the best discussion re the scam that is Residential Leasehold I have heard.
Really? Bad cases make bad law.
Doomers gonna be dooming (to get those extra clicks/views)
Chapeau bas for having courage to talk about.
In the US if you own the house and not the land it’s called a trailer park
In the UK you don't even own the house with leasehold properties, just the right to live in it.. it's dire..
That's england, a trailer park😂😂😂
😂😂😂
I’m afraid in the states you do have leaseholds, couple of clicks and you can see for yourself. Not trailer parks either. More like nice apartment blocks in New York and Miami to name a few.
@@choppernumberone7279 A couple of clicks tells me they're rare in the states.
We live in a leasehold in London in one of 3 flats owned by a management company called Gateway with the freehold. We recently received a bill from Gateway for £496.16, which they claimed was their incurred cost for replacing three 9V batteries in the smoke alarms in the building's shared corridor. Their in-house contractor managed the replacements, which took them two trips (they missed one of the alarms) over the course of 4 months. We have so many examples of them committing this kind of behaviour, it's relentless. On average we're paying out nearly £4000 a year to these crooks, and we have zero legal protections to protest their racketeering. It's despairing.
That's very strange 🤔
Had the same and worse when I owned a leasehold. It's awful isn't it. You can feel so trapped!
What about Right to Manage?
Right To Manage.
The Gateway was managing my block briefly and had the same horrible experience. Our flat has leak and cladding issue and service charge went to 6 k for a basic 2 bed flat and the management thinks it is Ok and the other day found an error on the Gateway account and now sent £2 k to pay more. The developer has not fixed the Cladding and no plan for it but built a shiny high rise next to my home, Galliard. Leasehold is a trap for middle class
To find out that the English legal system is stacked in favour of rich and wealthy landowners must come as a complete shock to anyone who hasn't paid the least bit of attention to it during their entire life.
Exactly. If you are not outraged, you are not paying attention.
The English -legal- system, full stop. It's not a proper democracy, just a pretend-one designed to keep the haves in power.
figured it out when I was 10, tbf it was 2010 so...
cuz UK obliged to rich russian oligarhs
go figure :)
@@saibamoe And they have NO scruples.
Extremely well done, The New Statesmen, this is a profoundly critical issue for ordinary people. The feudal leasehold fraud is a disgrace in modern Britain.
Feudalism was abolished in the 13c in England. English leasehold is super nice compared to most countries. Unlimited renewals at discount ,free arbitrators, free service or your right to choose. Amazing
There's nothing wrong with leasehold property if that's what you wanted. Not knowing the difference between leasehold and freehold is a problem though. Ask your solicitor about it and if you don't want leasehold property then move on. Freehold estates are abundant.
The spirit of feudalism is embodied in the practice of leaseholding. The UK is the only country in the world where someone can "buy" (actually rent longterm not buy) a house for the same cost of a freehold property (actually buy the building AND land purchased) and still not fully own the property they purchased. There are no benefits to purchasers of leasehold properties since they are paying rent in real terms to the landlords and in the end the purchaser (actually renter) owns nothing and has not increased their wealth despite all of their hardwork and investment. The only benefit is to the landlord who retains and increases their wealth over generations in the meantime impoverishing much of the rest of their society. We know this does not end well (1789). Thats why leaseholding needs to be abolished, for the longterm good of our society, including landlords.
@@Macavity01 For some reason well educated buyers have been in the dark untill recently about the important difference between leasehold and freehold but it's in the buyers hands, if they insisted on freehold estates wouldn't be able to get a buyer for leasehold close to market value
@@Macavity01 I cancelled my new build reservation after I did my homework on leasehold - seems to me, the outside world has moved on, getting fairer, but this place....
I m from Hong Kong. I m amazed at how this still exists. It does nothing but slows economic growth.
Bro. It's all leasehold in Hong Kong
@@carlitox4721 yet there s no scam. Why? If you knew how it works there, you wouldn't feel the need to say this.
And cause endless anxiety
Er, no. Has no impact on the economy whatsoever. it only has an impact on flat owners in poor situations where building services and ground rent are being monetised. That is far from the case generally.
@@seancloser bro. U don't even know if the Communists will renew your lease. There's no "scam" because everyone who complained now lives in a replacement leasehold building in London. We see Hong Kong refugees every day bro, la. Don't scam!
Barry is to be congratulated for his admirable commitment to this just cause for so many years.
👍🏾
Yes it's admirable.
But in the face of property developers/ big land owners buying their own political party look where his campaign has got us.
Only primary legislation from Labour to transfer the freeholds to current leaseholders and banning this feudal land ownership once & for all.
He seems to have got absolutely nowhere, though, except to discover it's the toffs in the House of Lords who ultimately own our stuff. They are not going to give that up until the pitchforks and torches come out.
We're leaseholders ina local authority block. The council exploits us just as much as private landlords and housing associations do. But the reason this country will never get rid of leasehold is that so many old-money families benefit from it.
Ding ding ding
To the barricades comrades.
I work for a Labour MP whose constituency has a lot of new-build leasehold development and covers a Labour-run local authority. It has been our experience that the local authority is far worse to deal with as a freeholder than those who own the freeholds of the new-build developments.
Yes I don't know how it would work for local authority blocks where the majority are still renters. I suppose you could own a percentage of the freehold, but the council would still be in charge of making all the decisions because they're the majority shareholder.
@@psammiad well that's where the law must change away from feudalism.
Racketeering at its worst!
For landowners with leaseholders it is simply fraudulent, for house buyers it is financial suicide.
Barry makes the whole subject clear and his commitment is excellent!
Lords who have a conflict of interest over this shouldn't get to vote on it.
I'm an Italian living in London, and I still don't understand why this is legal
Caviat emptor
Because UK is still a feudal system despite they believe they are superior in many aspects.
@@SomewhereOverTheRainbow2023 Yes, but in a tight,constrained market, you have little choice.
TOO MANY PEOPLE
Our smallest state of Victoria is bigger than the whole of U K yet has a tenth or less of the population !
@@linmal2242 bs. There are milions of empty houses all over UK. What is lacking is social housing but there would be houses for everyone but people can't afford them.
Then there are noble families which own half of the country land and have been doing so since the medieval time
about time this cruel unfair feudal system is scrapped!
Our one bed flat in London had a service charge of 3k and it went to 6k two years later. We then moved to a freehold house in Surrey, but our roads are not adopted so we still have a service charge which covers the cost of the lights in the block of flats next door. Complete scammers are running these services.
yup. im looking at downsizing, but those additional charges makes it much cheaper to buy a house than an apartment. how the fk does that work?
im downsizing and want to pay cash and own my next house outright, but 3k a year is still wanted, for what? painting a hallway every 5 years? i mean they act like ive got some amazing facilities and gardens on the property, not 1 parking space and no garden.
A friend experienced similar situation, he was pulling his hair out. It is a scam plain and simple
I know of road like this near where I live, the resident initially held it private to try and dissuade people from using it as a cut-through, the road is is such bad condition that the council wont take it on until the necessary repair works are done
So many things in the UK are related. Part of the problem is the councils can no longer afford to maintain infrastructure so they are allowing developers to build homes and maintain the land around it instead of demising it to the council to maintain. It's all the consequences of reducing the role of the state and letting rich individuals and companies run everything. These are the policies of the current Tory government and free marketeers like Liz truss who just want government to be the absolute minimum and then let the rich run everything and eventually cream off all our wages. Do we want a country like that? And actually, that is not traditional conservatism anyway, the Tories never used to be into completely open free marketeering. So fortunately, even traditional Tory voters are realising the party no longer has their interests in mind.
@@kanedNunable That is not freehold then !
Absolute con - needs a complete overhaul
Is leasehold being fraudulently offered or are people just not caring enough to enquire about it before they buy?
@@johnmurray5573we didn’t buy a leasehold but my solicitor did a great job in telling my friends who we recommended to use him the dangers of a leasehold home they were offering to buy. To the point where they withdrawn their offer and in my opinion dodged a massive bullet. I think as was said in the video these property companies offer people free conveyance if they purchase a leasehold and by using their solicitors they would not be so keen to make the buyers beware of these risks
Leasehold is also a way of keeping aristocratic property empires intact over the long term. Reversion to freeholder: The most likely scenario is the property simply reverts back to the freeholder without any additional payment from the leaseholder at the end of the lease.
no, not really - there is an absolute legal right to renew the lease at a fair cost that can be determined by the tribunal service
@@mikewood8695 If it is all so fair then why is there a movement to abolish leasehold at the moment?Extending a lease can be expensive due to legal fees and a process called "marriage value."
@@mikewood8695how will you afford to do that if you are ripped off every penny though service charge and ground rent??
It's immoral. Leaseholds should be abolished. Either you own something or you don't. Get rid of it!
They won't until Englnd gets rid of the House of Lords. It needs to be reformulated, and called sumpin else and be an elected body ! Unlikely, until the Muslems get into power; you are letting them in are you not ?
The best way to not be fleeced of your money in Britain is to go directly to living in a tent under a bridge.😮
Or abroad.
Everywhere really
lol and Suella wanted to stop people doing that, too. It’s mad
Never, ever buy "Leasehold"!
I avoided leasehold house when looking for new home. I will never, ever lease. Would rather plain old rent!
Easier said than done. We were 10 years youger, greener and desperate to get on the property ladder and frankly there were "10 year's less information" out there for us to know about what we were walking into. Also consider the snake sales people, who team up with con artist conveyors who frankly just lie to get you to sign. Now where is their accountability? Oh, there isn't any!!!
It's difficult when you are trying to buy a flat, and a lot of new build housing developments are leaseholds now.
What do you do if you're a single person or a couple looking for a one or two-bed? Almost impossible to buy any flat that isn't leasehold. Very occasionally you might find a flat in a house conversion that's share of freehold, but those places are very much the minority.
@@JohnMoseley Easy: rent! No other option do not purchase a flat then pay mortgage and lease fees on top.
An MP giving straight forward answers and information is good to see. Improving or getting rid of Leaseholds this is something else the Tories couldn't or wouldn't do.
He's not a tory and probably not a landlord or lease holder. So he's human.
Neither did Labour when they were in power. Both equally useless.
A Labour MP doing honest work? Surely Starmer will kick him out of the party soon then.
He literally said you shouldn't let the last Labour government off the hook, because they could have sorted this too.
Make all leaseholds freeholds by act of parliament. And the people who own the freeholds on leasehold properties? Well, let them think themselves lucky we don’t lock them up.
30:38 "You're a crook!" - they've had decades, in some cases hundreds of years, to exploit these arrangements. That's enough.
Not sure that doable unfortunately as freeholders are the owners, typically the process involves selling the freehold to the person currently in the leasehold property.
However you can incentivise the selling and probably put in price controls for what it can be sold for as well as who can buy it, something like making the freeholder liable to charges in the property.
If all the people who hold the freeholds are suddenly losing money rather than making the money you would see them trying to shift the freeholds as quickly as possible.
Yes. Make all contract law null and void while we're at it. 😂
@@user-xw3vi4nk2ywhat a spurious argument. If a contractual relationship is blatantly exploitative and involves behaviour that in any other circumstances would be illegal that contract should be voided. Leaseholds are a disgrace, and people owning them don't deserve anything for them. It is a grotesque form of parasitism.
Why does this continue, because we let it. When will it end, when we stop it.
In George Orwell's novel, Coming Up For Air, the main character, George Bowling, a cynical middle aged bloke that is bored of his London suburban life, moans about how buying a property is a rip off since you don't actually own the land underneath your own property. That novel came out in 1939.
His _manual_ "1984" was rather accurate also.
You do in AUS, but you don't own the mineral rights ! They belong to, get this, "The Crown" ! Maybe that has changed since the 'Australia Act' passed your parliament ?
@@linmal2242 To understand why, read "The Conspirators' Hierarchy: The Committee of 300."
@@linmal2242 Even with Freehold you don't OWN the land in UK, but rather you have the right of control. The Crown still owns the physical land.
If only more MPs were as passionate as him.. one could only hope for change
Many MPs and Lords (all parties) benefit from leaseholds which is why nothing ever gets done about it. Barry talks a good game but his party did bugger all about when in power.
👍🏾
@@stumac869 yeah I agree, and Barry acknowledged it here. They made a start and I di remember that labour government bring into law the concept of commonhold at the time. It is still there in law, but no one uses it because we've still not scrapped leasehold. Cameron was going to do it, but as always the feudal landowners of the UK wield power over government. The current Tories are never going to deal with it, and they've frankly made a mess of building safety. Id rather labour come in and take the next steps, even if they don't scrap leasehold altogether, we should still be able to tighten up how it works and put more responsibility onto land owners.
Absolutely, hence Gove having said he would banish it, has done v little. He needs to abolish marriage values which is the biggest rip off. Many leaseholders are currently waiting in limbo meanwhile the lease increases in cost. One maisonette on our development renewed for £14K four years later one's renewed for £30K, it's scandalous!
Pity passion isn't sufficient for action, Gove probably realised the majority are party donors or maybe he just didn't have enough knowledge of leasehold, MP's will say and do anything for votes thankfully it will be Labour sorting it out.
Excellent discussion.
I am from Canada.. and did not know anything about this but was told when I bought my flat, this was quite common in the U.K. and as long as the period was over 100 years, there was really no material difference in my rights as owner.
This has turned out to NOT be correct. I am careful to have no dispute with the feudal holder.. whatever charge is asked.. I pay.
I am hopeful Mr. Gardiner will achieve these necessary reforms. I am shocked that this is permissible in modern Britain.
I’m soo glad I pulled out of negotiations for a leasehold flat a couple of years ago. The seller was wanting the same price as comparative flats, but there was only 30 years left on the lease. So i started looking into the process of extending the lease and it got soo complicated and impenetrable it seemed I couldn’t find out how long it would take or how much it would cost until i started the process, and I couldn’t start until i owned the lease. and as i learned more I started to find out about all these other awful things that go on with ground rent and service charges etc. But i feel like i dodged a bullet. I loved the property and if there’d been 90 years left on the lease I might have just gone ahead and never known about the risks until it was too late. I ended up in a great little freehold house and I’m soo happy I don’t have any of this BS to worry about with it
You really did dodge a bullet. I had a total nightmare with a leasehold flat. That was more than 6 years ago but I'll never be the same again.
I was looking at how to extend leasehold and apparently they can ask for up to 100% of the market value for the lease extension. You did dodge a bullet. Be happy where you are! I'm sure it is better
Dodged the same bullet! I was going to just suck up the service charge until hidden in the paperwork it was secretly double what the seller and agent were advertising it as - over £240 a month in Leicester, now in a freehold terrace perfect for me and my girlfriend
@@kaneeato5441 Leasehold was what caused me to eventually move out of London. Sure, I no longer live in a funky part of town but this tiny two bedroom terrace is mine, fully mine and ONLY mine.
@@kaneeato5441 put mine on the market, service charge was £580 for 6 months (April 2023). Sale fell through. £750 in October for 6 months. Next month, for 6 months it will be £941.
At the time the advertising was correct and had been that amount for 4 years.
I always knew from a young age not to buy leasehold because it meant you did not own your home, really and you didn't have complete freedom and control. I never knew why people would buy leasehold unless they were desperate and could not afford anything else. The first thing prospective buyers should ask is 'Is it freehold?'.
For flats it's because UK law can't make freehold flat owner contribute to the repair of the common parts, eg roof, external painting, lifts, cleaning etc
@@Dav1Gv that's why commonhold is the solution
@@mistyskies6396Allodial titles are unjust.
Freehold is the same. You need Fee simple exempt and reserved!
That is why we have Strata Title in AUS.! You own the 'four' walls but have an interest in the Strata which owns and manages the 'Common Property' of the premises; stairs, landings, gardens, roof etc. And you are or can be on management of the 'Body Corporate' where you get a say in what happens to the whole property !
One of the best things Ireland did when leaving the UK was to declare that while ground rents would survive the independence, no increase in ground rents could be done. By the 1980, the value of those rents had fallen so far through inflation that it was hardly worth collecting. Later, it became a right of residential ground tenants to buy out the ground rent on their property for 10 years worth of ground rent. Typically, in the Pembroke estate in south Dublin, the resident could buy it out for £50. It seems the government of the UK could benefit the average UK property resident citizen by looking back on this early example.
This was done for Rentcharges [or Chief Rents] in the Rentcharges Act - 1977. These will all expire in 2037 and can be bought out by a fixed calculation in advance of then. Many are under £10. They were popular in land deals in Manchester, Bristol and Bath.
@@peteglass3496 Thanks for that. Why are grounds rents so high in areas including London so, where I understand people pay several tens of thousands for another 99 year extension?
Where is your title; free and clear? In AUS we have 'Torrens Title' named after the river Torrens in Adelaide in
S Aust where it was invented,, widely adopted worldwide, but states have also 'Strata Title' for multi properties which give ownership to the holder of the 'four walls' of the apartment !
The Strata Plan owns the land on which the building sits.
One for the worst things Landlords are doing is the building insurance. Ours has gone up £7000 per year for the last couple of years for 36 flats. Total this year £52000
I don't know how this works, do you have a right to scrutinize the insurance documentation so you can see what they are actually paying in comparison to what's being charged?
I read somewhere that at least 30% of the insurance charge is a hidden backhander to the managing agent. Where possible get residents to become directors, arrange your own insurance.
it's possible that the landlord is actually in contact with the insurance company...... (this is an hypothesis and doesn't pertain or refer to any individual or company)
Steve, we had a landlord who was the insurance broker! Every maintenance job was always mysteriously done by contractors within their postcode despite the actual property being 65 miles away. I googled some of the telephone numbers and found them very often not the company at all. I spent 50k extending the short lease and flogged it quick. Never again my friend.
that's not necessarily the landlords' fault - insurance has gone up a lot everywhere for everyone - and due to Grenfell, if you're in that type of building, the fire risk / hazard that needs insuring has indeed gone up a lot
King Charles & Prince William own a number of leasehold properties via their respective Dutchies. It absolutely suits the landed gentry in Britain to retain the leasehold property model.
The UK is the most undemocratic society in Europe... brexit was all about keeping the ruling class and the royal family in charge, never about the people. Actually, the people are worse without the legal protection given by the eu...
Sadly in Australia new building developers retain control over the management of the building developments by retaining a number of apartments and stacking the management boards!!! All these kinds of systems need reforming regularly. They are always gamed by the greedy.
New developers working the system to keep control. Should be abolished, made to divest !
It's an absolute scam. Why on earth is it still legal? Because pension funds own them.
Excellent podcast, but surprised there was no mention of the situation in Scotland, where leasehold has been abolished, and the extent to which this could form a template for UK-wide legislation.
It sounds to me like these leaseholds are adding to the wealth of the already wealthy. That would be why precious little has changed in the last twenty years and I'd bet that nothing will change going forward. One thing the leadership of this country are unwaveringly committed to is that the already rich continue to get richer.
Nothing in Britain regarding property law has changed since 1013.
Spot on. They have got it with both hands and are not letting go !
Literally just exchanging contracts on a leasehold this week. So thanks for cheering me up.
Don’t do it!
Not sure where you live, but if you have an option of a freehold, get a freehold. If you live in the South(BCP), that may prove a bit tricky, but if possible, do not get leasehold. You will never own it and that is the biggest problem. Once the leasehold is over, they can ask you(or your children, grand children) for up to 100% value of the property. And a property with less than 60 years becomes almost unsellable as not many will give you mortgage.
@@nedgeson326 Not really any other options in London. Its that or pay 2k a month servicing someone else's mortgage.
@@DanCThorpe Please try to find out WHO owns the freehold before you sign. If it's anything like as opaque as what is discussed in the video have a serious rethink. Bear in mind that the freehold can be sold on, as was the case with my flat in London. What had been a reasonable service charge and almost peppercorn ground rent ballooned very quickly with additional, extortionate monthly demands of money. Ultimately, it became unsustainable but when I tried to sell things got seriously nasty. It cost me 60k to extricate myself from that leasehold flat but the cost to my health was far worse. I'll never be the same again.
Hope you don't regret that decision
I feel like something that's happened since the late 1990s is that due to sustained lower interest rates, and then even lower rates and QE post 2008, you've ended up with huge amounts of capital looking for a home, and property has been it. This has led to a boom in companies that want to try and get as much return out of leases as possible, as these companies have been invested in by investors trying to grow their clients wealth. We've had leaseholds for centuries and pre the 2000s we just didn't seem to have these problems. Leaseholds were a steady little earner for some historic owners, but nothing major. Since 2000 property has become such a boom industry that you've got players involved that are trying to maximise returns as much as possible.
Yip watch Gary on economics, inevitable
@@mattgibbs2205combine that with Turchin's theory of elite overproduction & I expect some kind of violent upheaval in the future.
New Build leasehold flats are exploitative, but we also have the problem with the housing estates and their 2m people. Then the housing association. Everyone under right to buy
The closure of estate offices and merger of HA into mega charities has created incredibly bad, expensive service which needs to be devolved
Just TOO MANY PEOPLE .
Outstanding guest. One of the best New Statesman podcasts. Another area of concern would be Life Assurance companies. One pays each month over years but never have contact, even when your policy is sold to another provider. Never ever buy a policy, put the premium into a savings account or ISA.
Anything Rees Mogg is against, I’m all in for
He is someone who should be on the cover of Punchable Faces Magazine.
That man is evil
It is all very well banning new leaseholds and making everything commonhold going forward, but what about the existing leaseholders caught in this trap, their properties are devalued by the two tier system that will be created !!! Leasehold has to go, all of it, everything ! No such thing as leasehold should exist. It is extortion by legal means ! They will argue that it is a transfer of wealth, however when you invest, capital is at risk, the value of your investment can go down as well as up etc etc. These charletans have had it too good for too long, abolish it now !
Leaseholds will never end in the UK, because the members of the House of Lords are the main leaseholders in the UK.
You mean in England.
Yes it’s a eye opener listening to how the workings of Westminster operate it is a eye opener amazing that these crooked peers and political sponsors have complete dominance over the majority MPs that we elect. I knew it was corruption however this video also answers many questions that many of us are asking ourselves regarding Political support for this most evil apartheid state of genocide.
I think you mean they are the freeholder?
Our LABOUR council is charging unbelievable amount of service charge to the leaseholders, and making profit by adding 10% admin fee on "inflated fuel and other costs" which is extremely unfair. I hope Labour starts with the Labour councils to fix this issue...
Fortunately I managed to sell my leasehold flat over 2 years ago and even then it was a nightmare. We had constant charges for repairs carried out by shoddy builders, then the freehold(private company) would have the check to keep asking for more money to fix these problems. I ended up selling my flat, just too get out at a loss to a property developer( probably someone involved with the management company). The issues we had affected both myself and my neighbours mental health. It was dire. To think that if you didn't pay the freehold than you could forfeit your property. Disgraceful.
What a breath of fresh air Barry Gardiner MP is. @29:40 sums it all up really.
and Andrew Bridgen also - there aren't many of them, ,but there are a few
Excellent video. As a shared ownership leaseholder I've suffered a double blow.
How did I know the reason the Lords were blocking legislation was that many of the members actually derived their incomes from property and leaseholds. What a surprise.
A new housing estate near me is leasehold and has maintenance charges, it makes me feel ill at how we are just being shafted at every stage of our lives
Spot on in all respects. Until we remove this feudal system we will never progress housing.
I had this in a leasehold flat 30 years ago - I didn't understand the implications at the time, and it seems people still don't.
In addition, I believe that c.30% of all land in England and Wales is still not on the Land Registry, despite it starting in 1862, as it hasn't changed hands in centuries, and there is no way to force it to be registered to increase transparency of ownership and vested interest until it is sold.
So much to do...
did I get it right? someone owns a piece of land, the government doesn't know who exactly owns it. The only way to prove you are the owner is to have an old piece of paper that says so? A piece of paper that the government doesn't know about?
land registration is up to about 88% as of a couple of years ago, it is worth noting that laws passed in 1925 and 2002 have significantly broadened the obligations for registration since 1862 (where I believe it was almost totally voluntary) and there has been a concerted effort to move totally away from unregistered land - about time
Charlie + family own it , that's why its not registered !
Thats how the toffs keep their families wealthy , without lifting a finger and doing an hours work.
I was looking to buy a house on a private estate, turned out it was a ‘freehold house’ but in the title deeds there were restrictive covenants which requires you to pay annual service charges to a management company and abide by estate regulations. No control over the charge increases and if you don’t pay they can stop you selling your house. Fleecehold. I steered a country mile away from that!
I believe that councils are not completely innocent in this. It is often because they they do not want to adopt and have the cost of maintaining all the roads, greenery etc. However how it is then managed by a company is still a scam to make a profit, i.e why can't residents manage the maintenance themselves if can't be adopted.
@@David-bi6lf Precisely! This is the next big scandal - new-build freehold estate charges.
They effectively operate much the same way as leasehold service charges, but are even less regulated. The management companies can be resident owned, but are often owned by third party companies.
The companies own the common parts, estate roads, water and sewerage service media, lighting, and all other common infrastructure - some of which isn't up to adoptable standard and or not used by the wider public, so local authorities don't want them on their books.
I looked into new builds and I was told about this change. I asked the estate agent why ? Isn't this council's charge? She didn't know what to say 😂. I just couldn't understand why we would pay council tax and this extra charge.
@@ingaju88 estate agents are clueless and aren't interested in anything, except their commission from sellers / developers
Like you did, always best to do your own research and be sure to use a good lawyer when buying a new build
@@danielduggan7126 I agree resident owned management companies are fine. However in this example this management company was owned by a completely separate set of people not living on the estate who are operating the management company for profit. You have to pay the charges that they set at their own discretion, you have to abide by estate regulations they make. All of this is built into your title deeds with restrictive convenants meaning if you don’t pay/comply you can be prevented from selling your house. In addition they can raise charges on residents to enforce breaches I.e. if you don’t agree to comply with a fee and they take you to court, all the residents management fees will be increased to cover the costs. Other nasty scenarios could arise from this situation e.g. if estate regulations say no dogs or noise, the management company can open an ‘investigation’ against you the cost of which is recouped from the residents. So this for profit company owned by non residents has a vested interest in raising charges, doing works, keeping the estate beyond perfect and investigating every single breach of any regulation they make. At the end of the day they get paid for all of it
How is this scam still happening unbelievable
Leaseholds are rubbish... it's not until you live abroad that you realize it's a scam that only occurs in the UK.
Not in Scotland
@@lewismcdonald9691 Well they do exist, the Scottish property centre says they do. But as I never had a flat in a block in Scotland don't know. But in a block then what happens if shared spaces need repair? That's a genuine question, interested to find out. Because you could be bankrupt if you need to shell out.
@@peterharridge8565In Scotland, shared/common areas are usually maintained by a "factor" (a private company) appointed by the owners of the flats in exchange for a monthly or quarterly fee. This also normally includes the building insurance. If no factor is appointed, the owners usually self-organise repairs, cleaning, building insurance etc - but this is less common (in Glasgow at least, from what I've seen). Flats' title deeds usually outline the rules, and any rules that pertain to the specific property under its "burdens". We abolished the feudal system in the 70s and was reformed again in 2004 if I'm not mistaken.
@@peterharridge8565nah, 2004 act in Scotland abolished what is known as fuehold. Which is the rough equivalent of freehold in England
@@davidforman6191 See above reply, I remember factors came up when I was searching for a property in Scotland. I don't really see much difference between that and leasehold. Because in essence someone is doing repairs to shared spaces. Where it goes wrong (in England) is that those who who owned the land aren't doing what they should always. And apparently asked for extra money in one case. Well they are already getting service charges from leaseholder.
I suppose main difference is you choose (or all the leaseholders/owners in the block) choose in Scotland. I certainly though wasn't that happy with the situation , namely you pay extra per month when you own a property outright. Now you mention it, it was the main reason I didn't choose a flat in Bute rather than Dunoon (where no factor for the property as not a block). That said actually there was still repairs to be done that are shared areas.
That is unsolvable by any system. Who pays for shared areas, esp when they are major issues. I mean say £100 per month isn't going to be enough when a new roof or drive is needed. Talking thousands.
If you look at the origin of “leasehold” it becomes abundantly clear who the system was devised for and why!
Shame on this and previous Governments for not abolishing leaseholds. It is a massive scandal which surely must be tackled once and for all.
It would take Royal consent which is why it will never end while we have a monarchy.
It’s the case with soo many things that everyone can see are bad and harmful to society but never seem to get fixed. Look at who donates the most to the current government and you’ll often find out why positive change doesn’t happen
We also have to hold politicians accountable.
Hopefully with the upcoming election this might be sorted, but I wouldn't hold my breath.
Yes but this country and other rich countries exploits poor countries. But we don’t really complain much about that because we gain from it.
The way owning a flat works here in Sweden: blocks of flats are owned collectively by the association made up of the people who live within it. When you buy a flat, you buy membership of the association (and pay monthly fees to it) and the right to live in it - its called a "bostadsrätt" ("residency right"). The people in the association also collectively manage the building.
The way owning flats works in Britain certainly needs an overhaul - and this includes the whole model of homeownership. The bostadsrätt system in Sweden should be looked into, and I'm sure there's other models too.
Sounds way better.
that's pretty much how it is in the United States too. There are two major types of ownership; co-op, and condominium. In a co-op, the association has to collectively vote to approve the sale of the unit and the new owners; so that can be a significant hurdle; there is no such limitation in a condo. With both, elected boards of directors make decisions on behalf of the association, sometimes with advice from a management company, sometimes on their own. However here is the catch; condo and co-op boards in the US aren't as regulated as they should be, so they range from really excellent to truly appalling, and condo redevelopment isn't regulated enough either. So as a result too much in the US is left to chance -- the level of financial reserves, training for board members, quality of materials used in a conversion of a rental building to condo or co-op, and so on. Still, the only way you're going to get anything in the US even approaching the extortionate demands of UK leasehold is if the distribution of assessments and voting rights WITHIN and AMONG the members of an association is unfair, as opposed to ALL members of an association getting fleeced by the developer/freeholder forever.
One way or another you still have to pay for building insurance and maintenance, whether it's to the landlord or directly
@@tonyatthebeach yes, but in the UK a single private landlord can jack up the assessment for no reason beyond private profit, while in the US it's a condo board decision and that board can be removed by election, so there's some general tendency for it to roughly match the building's actual costs.
Same in Belgium, there's a copropriete. You own a share of that depending on your floor area, it's like a company with board meetings and all that.
Thank you for explaining in clear and concise manner why it is a terrible idea to buy a leasehold flat. This form pf modern time feudalism is absolutely scandalous.
Leasehold is a scam. It’s a way of profiting from selling flats but keeping the ownership once the lease is finished.
So if the lease is not extended the flat goes back to the owner of the land for free even though it was sold at a full price. Very bizarre!!
I think is a way nobility in england/wales maintain their wealth.
Leasehold is a diminishing asset. You don't really own it, and once the remaining period of the lease falls to around 75 years, it becomes practically unsaleable. Only remedy is to go to the landlord (freeholder) and pay thousands to bring the lease up to 99 years or whatever period lenders consider secures their loans.
Depends where you live, in London even short leases are very valuable
This stuff is criminal i cant understand how we all go along with it for so long 😢
Leasehold needs to be put into the dustbin of history. It's an embarrassment.
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YOU GET WHAT YOU VOTED FOR. OR IF YOU DID NOT CONVINCE OTHERS TO NOT VOTE AT ALL. THEN YOU WERE ST THE MERCY OF THOSE YOU FAILED TO CONVINCE. THAT VOTING FOR CRIMINALS. ie;WOLVES IN SHEEPS CLOTHING. WHAT DO EXPECT IF YOU STAND BY & DO SOD ALL! SO VOTE FOR THE TRUE & RIGHTFUL HEIR AND MONARCH. OF ENGLAND. TO TAKE UP THIS POSITION. ANDBTHERE WILL BE PEACE AND STABILITY IN THE UK AND THE COMMONWEALTH COUNTRIES. HIS PARTY IS FREE TO JOIN. AND SHOULD BE PUT DOWN ON THE NEXT BALLOT PAPER IN THE UK. WHETHER IT BE A LOCAL COUNCIL ELECTION. AND MOST CERTAINLY ON THE BALLOT PAPER OF A GOVERNMENT ELECTION. HIS NAME IS - IVAN TALBOT. BHIS PARTY IS ivantalbotparty.org WRITE THIS IN A GOOGLE SEARCH BAR. AND CHECK EVERYTHING YOU CAN. THEN URGENTLY PASS THE INFO AND THE PODCAST AND HIS PARTY INFO. TO EVERYBODY. YOUR FAMILY, YOUR FRIENDS, THEIR FAMILIES, THEIR FRIENDS, Etc, Etc. From Mr RODNEY HARRIS FRASER.
Im a leaseholde in a lfat in manchester. The ground rent is about £280 p.a. which is not too much. But you have to pay it at 6 month intervals and if youre more than 30 days late paying it you can get slapped with charges and fines of over £1000!
Really happy we have people like Barry in parliament. Gives me hope that the next Labour government may be able to make things better. Getting rid of the hereditary peers should pay off now.
What a racket..! Haven’t lived in a leasehold property in a long time, and never would again.. nightmare stuff..
The reason House of Lords won't allow the bill for leasehold abolishment to go through is because it would be shooting themselves in the foot.
Yes, my brother go stuck in one of these in his Hove flat. He didn't know how to get out of it and didn't want to sell as the buyer would then be in the same problem. It's a moral delemmer for sellers.
and after there is a problem in this country that people don't even want to try to have their own property only social houses .
dilemma
Barry discussed the problem about retroactive policy. One route around some of these problems can be transition arrangements and sunset clauses. As well as his 1967 case, another example is the abolition of Rentcharges [or Chief Rents] in the Rentcharges Act of 1977, where all rentcharges expire in 2037 which is now only 13years away. These are feudal charges on the land rather than the property. Frankly all the ones under £10 [or perhaps £11 to catch 10guineas] could be scrapped now at a loss of barely £100 to the owners and a clear out of unnecessary costly admin to manage or buy out. There is also some abuse on collecting arrears by vulture lawyers which could be ended if both suggestions were packaged in an extra amendment in a further leasehold reform bill.
Wow, leaseholds are even worse than I thought!
We dont have this scam in Scotland, thankfully.
No, you don't. Gonna move to Scotland soon, prepare a welcoming cake for me 😁
@@nothereandthereanywhere We'll get the kettle on too. Tea or coffee?
Sadly though the whole of Scotland is some sort of leasehold with the England as your lessor 😂
in scotland we have another anomaly / scam , where a joint owner can transfer their share without other owner consent , cant do it in england its illegal, see my comment on here
My 2nd property had Feu duty but it was only about £36 to pay it off forever but that was 30+ years back.
Close to getting rid of my leasehold but not there yet. Leasehold law is a joke.
You have all my sympathy and I sincerely hope it's soon over for you. I had to pay ransom money to extricate myself from mine.
sounds about right@@piplebref4607
Very interesting programme, thanks.It highlighted aspects of leasehold of which I was unaware. I have had a living nightmare with leasehold. I am particularly scandalized by the incompetence and corruption of housing authority freeholders. Good to see Barry is still onside.
Think of the money that would be free'd up that would be pumped into the economy instead of being hurried away to an account in the Cayman Islands. Disgusting country we live in
If you rely on the Government to sort it, forget it. Just don't buy leasehold, it's the only way to end it.
Many smaller and more affordable properties are leasehold there lies the issue....
@@clareshopaholic3632 Still don't buy them because you are just buying trouble.
24 years ago it was all I could afford, leases weren't so expensive then and it's a con that when only 20 odd years have expired on a 100 year lease marriage values apply.
better off in a van or motorhome - or a cardboard box@@clareshopaholic3632
Good to see this issue getting addressed. It should be abolished
How greed is ruining thia country...
Leasehold is a great British tradition and a wonderfully legal scam.
Leaseholders own this country… that’s why its still in place
I think you mean the landlords/land owners own this country - the lease holders (tenants) are the ones that are being exploited.
@@tonysadler5290 yh sorry
I forgot to say I had to write to Barry and he supported me to get Brent to accept responsibility for the repairs to my roof - thanks Barry
This gentleman restores my faith in MP’s/politicians, but sadly the good ones are up against those who have deeply filled pockets 💷
Just ban career landlords. Limit everyone to owning 2 residential properties in the UK. Outright ban companies from owning residential property and force them to put a named individual as the owner of all property - make it so it has to be the person in the most senior position in the company. Then they have to take responsibility for issues with the property. Keep a public record of every property and who the named individual it is owned by - make it very transparent to everyone. Then people won't want to be landlords. No one needs 50+ properties that they don't look after. It ruins our country and society.
Absolutely. Key to rebalancing society and people's understanding of how to live well.
Absolutely the best and most informative piece on leases and leasehold reform I have ever had the pleasure of listening to. My question is, if/when Labour win, how are they able to overturn the current system without going through the same House of Commons/Lords and various committee stages? Presumably, if the Lords don’t want reform, it won’t happen?
You want Labour to win? We are fucked!
He literally said Labour kicked out most of the hereditary peers, so it's mostly bishops and former politicians now. What he also said was that we shouldn't let the former Labour government off the hook for not then fixing this. This is something all parties don't care about because they don't think it sounds sexy enough to win votes, or the change will be visible in time for the next general election. So when they reform it, they expect not to get credit. There isn't one party that's better on this, they're all bad at it.
labour are just WEF 2 as opposed to WEF 1 - if we remained in the EU before Brexit, that's WEF 3 - we all need to wake up and be brave and vote for independents like Andrew Bridgen or people putting themselves forward for the Reform party - then we'll see real change and we can make laws that redistribute land from the crown and corporations - many secretly offshored in tax havens and take back control - properly - not the BS Brexit version where the populous has fewer rights and privacy than before!!!!
@@missruzl14 Sounds like you already are, if you are a leaseholder. You are not, presumably. Are you in the Lords?
I bought a leasehold flat and the cladding needs replacing because of Grenfell understandably, so. I pay £1500 a year in service maintenance costs and £150 in ground rent only to find out that the freeholder has no emergency fund and can’t pay their half of the cost of the cladding replacement. This now means that the 12 of us are on the hook to pay everything. What do we actually pay him for?
I remember under Blair and Brown a Labour Party document was released called An End To Fudlidlisum. Strange this PDF document just vanished? My friend John Paterson and I were involved in Labours Commonhold Bill, and Residential Leasehold Reform Bill. Strange both of these went nowhere? Now doesn't that make you wonder how much pressure local authorities, other resident social landlords and private landlords were against change?!?
Vested interests.
We become slaves to these schemes, Your life for 30 years is taken over so that some people can make billions... We go from bad to worse😢😢😢
I am glad that this issue is raised. Thank you.
The fact it's been 20 years and nothing has changed, says enough
That was great, well done all round on this discussion. 👏
All part of the Norman yoke which Thomas Paine identified as essential to remove.
Ha ha the Americans ain't done too good a job of de-Normanising their economy have they?
The fact that someone is allowed to rent and inhabit a flat which isn't able to be sold basically amounts to somebody somewhere saying x amount of pounds is worth more than the tennants' safety. This sort of attitude should prevent anybody from being allowed to collect rent.
Not a genuine "safety" issue is it though lol. We haven't had grenfell 2. Or grenfell 3, 5, 10 etc. They are sufficiently safe it's just scaremongering
I heard it was Labour policy to massively reform the leasehold and my MP confirmed it. Let's hope they stick to their word... let's see!
That was superb and, for me at least, highly educational. Thank you for taking on the topic and hosting two fantastic guests in a thoroughly absorbing session.
I'm Australian, I own a property (with my wife) just outside Melbourne and we are maybe a decade away at worst from owing it outright. Land, house, everything. Only thing I would be on the hook for is council rates every year. It would be my families land forever if they so desired...
I obtained my UK citizenship a few years ago and dreamed of moving to the UK, and I am beginning to suspect that I am better off staying put... It sounds like things are not good over there at all 😞
Depends where you live in the UK. Life in Scotland is probably much better than life in the majority of England - less traffic, less crime, less pollution, lower cost of living, no leasehold, beautiful scenery. If you're coming from Melbourne, then you are likely wealthy enough to be able to afford to live in Edinburgh - arguably the best city in the UK overall to live in.
But, I don't know if it's better than Melbourne. From people who have lived in both places, my understanding is that Australian life is very relaxed and High quality, but rather boring compared to living in a UK city - so depends what you're looking for.
I reckon that is a spot on observation about Melbourne. Australia in general is a very small minded country in general.. thanks for the tip about Scotland!
Mate, stay away. I came from Toronto for family reasons and this country is a shithole. A move that impacted my life negatively forever.
@@bm8641 Move to Melbourne. Lived there in 70's. Sydney is now too expensive and crazy. Grew up there in the50/60's now live in Newcastle, Much quieter, laid back, with a view of the Lake !
Thankfully I live in Scotland. In Scotland all flats, houses etc are freehold. Some small bills for common parts of the building, but nothing too shocking.
This was sooooo useful and honest - thank you. Every time I think actually I really want one of those plush new flats with all the integrated appliances ....
Something to note here: one doesn't always have that much choice. If you're a single person buying a small place, it's well nigh impossible to find a flat that isn't a leasehold.
Then you will have to buy a 2 bed house, is it much more money. Well no. My sister bought a first property that was a house, I think maybe a 1 bed house (could have been two bed but small). The price about £10K in Biggleswade in roughly 1978. In the north east often the cheapest properties are houses, in my area literally loads for less than £60K yes right now. I don't think there are any flats for that price.
@@peterharridge8565 Thank you, but I'm in London and it's not the same here. Even share-of-freehold flats in converted houses are much more expensive than leasehold flats of the same size, or even bigger.
In London. Well not affordable for many. Not within Greater London or even within the M25 area. Even in home counties unaffordable. The reason being too many people. Supply and demand. Even in Luton prices have gone up incredibly. In 2017 was paying £600, 2014 £450 PCM for a 1 bed which was a house originally divided up. My guess is the person who did this work retained freehold as I know only 75 years left Leasehold for owners as she wanted to sell, that is the reason I left. The price £75K, could she sell, maybe to cash buyers. But that was a 1 bed flat with its own courtyard and stairs to lounge.fiurther stairs to bedroom. So unusual and my removal guy not happy. For obvious reasons.
move abroad or live in a van - I've done both
find someone who you can trust to buy a freehold small house with you - there's always choices - if you have a passport get the hell outa the UK like a lot of smart people over the past few years - if they keep poking the Bear, Putin is gonna nuke the UK anyway
The feudal leasehold just needs to be abolished. Not changed, not make mandatory the renewal of the leasehold: just abolished. Those people already took money, it’s a mob racket legalised.
"You can pay full price for something, but it ceases to be yours." This is where a lot of things have gone with digital products too. That also needs sorting.
Thanks for raising this issue. 1 month after I moved in to a leasehold in London I got an invoice from the lease owner for £23,000 (not declared when i bought the place), which was not that different from the deposit on the mortgage! The same thing happened again multiple times, and ultimately I sold the house. The crappiness of the experience was a big reason I decided to leave the UK.
Yes, turd island.
Likewise.
I also had a leasehold flat and it was the catalyst for me to sell up and leave the U.K. too!
Odd how Scotland effectively banned leaeehold you wonder why England doesnt do the same.
When my wife came to sell her flat a couple of years ago, despite the building not being tall enough to require an ESW certificate, potential buyers' solicitors still insisted on needing an ESW certificate. Luckily she got a cash buyer (though she got less than it was worth).
It's only worth what someone will buy it for
It amazes how many properties for sale on zoopla say leasehold status of them is unavailable. That's basic information.
im looking at downsizing. what i want to know is why cheap apartments want 3k a year for maintenance costs. how the hell are they that high? its not like they have some amazing shared spaces and gardens. just a shared hallway. someone is ripping people off here. if i live there for 30 years that 90k extra?!? far more than was spent building the apartment. does it all get replaced every 20 years? no. why so much then?
move abroad - so many good reasons now to find a far better, happier, warmer sunnier place to live - with no council tax, no heating bills, cheap solar electricity - I'm amazed more people aren't doing it - rip off Britain is one of the worse places in the world to live - leave it to the immigrants who just don't know any better!
Leasehold doesn’t help anybody other than greedy companies who own them.