St Helens councillors unite in bid to stop 'leasehold abuse'

The council will write to St Helens MPs to ask for their support to tackle leasehold abuse through their Parliamentary activities
The council will write to St Helens MPs to ask for their support to tackle leasehold abuse through their Parliamentary activities

A motion calling for the government to back Labour reforms to the leasehold system has received cross-party support in St Helens.

Unlike a freeholder, leaseholders do not own the land the property is built on and instead pay ground rent to the freeholder.

In some cases developers have sold on the leasehold to investors, who have then increased the annual charges significantly or the leasehold buyout clause.

Back in June the government announced it was to ban leaseholds on all new-build houses.

The following month Labour unveiled its own plans for a “leasehold revolution”, vowing to end the sale of new private leasehold houses and flats and crack down on the controversial practice.

On Wednesday St Helens Council debated a Labour motion that proposed several actions around the sale of leaseholds.

Newton councillor Seve Gomez-Aspron, who submitted the motion, said the majority of new homes in Newton-le-Willows are sold on a leasehold basis.

“In the excitement of buying a new house it can often be something that gets missed without realising the consequences,” Coun Gomez-Aspron said.

The Labour councillor also revealed he himself is caught up in the scandal.

Coun Gomez-Aspron said the freehold on his Newton-le-Willows property was sold on without notice and the cost of purchasing it has now tripled.

“We never got a notification they were selling the leasehold we just got a letter from the new company telling us it had happened,” Coun Gomez-Aspron said.

Former council leader Derek Long called the leasehold scandal the “PPI of our decade”, adding that it would be even bigger than the PPI scandal.

“It’s a terrible situation people find themselves in because of the greed of some developers,” Coun Long said.

Liberal Democrat councillor Michael Haw said “bold interventions” were needed to fix the UK’s “broken housing market”.

Coun Haw said: “Banning new leaseholds and capping existing ground rents so they are affordable for residents will enable homeowners to buy their freehold at a small percentage of their house cost.

“These are the type of bold interventions that we need if we’re ever going to be serious about fixing our broken housing market.”

Thatto Heath Labour councillor Richard McCauley, cabinet member for economic regeneration and housing, said many residents in his ward have been affected by the leasehold scandal.

While backing the motion, Coun McCauley said he was “not holding his breath” the government are going to do anything to change the current situation.

Coun McCauley said: “What we need is a Labour government who will back those who own their own homes.

“This includes homeowners who own their own homes as leaseholders and who are currently unprotected from rises in ground rents from developers or management companies.

“A Labour government will give leaseholders security from these rip-off ground rents and end the injustice of freehold houses in new developments.”

Conservative group leader Allan Jones said Tory councillors would support the motion, despite it effectively meaning they would be supporting a Labour campaign.

Coun Jones said: “Exploitation, being ripped-off – we don’t like that. Nobody likes that.

“We’ve looked at these and the only thing we don’t like about it means supporting a Labour Party campaign and I don’t like doing that.

“However, our feelings towards exploitation and being ripped off far outweigh those of supporting a Labour campaign.

“The only thing I would disagree with is with Coun McCauley when he says we need a Labour government – no we don’t.”

Summarising, Coun Gomez-Aspron said insisted the motion was not an “anti-developer motion”.

Coun Gomez-Aspron said: “We need new houses. I could not live in the hometown that I live and grew up in if new houses hadn’t been built.

“The point is doing it in a way than doesn’t penalise families who live there by fleecing them for the pleasure of living there.”

The motion was unanimously passed following a vote.

St Helens Council will now write to the Secretary of State for Housing, Communities and Local Government to call for the implementation of the reforms set out in Labour’s campaign.

The council will also write to St Helens’ MPs to ask for their support to tackle “leasehold abuse” through their Parliamentary activities.

In addition, chairs of the relevant council scrutiny panels will be instructed to request that an appropriate piece of scrutiny work is undertaken to establish how widespread the issue is in St Helens.