Onerous Leasehold Ground Rents Tackled by Nationwide
We recently reported on the leasehold ground rent scandal which came to light earlier this year.
The scandal involves freehold owners of properties including onerous ground rent clauses in lease contracts, which can result in ground rents spiralling from nominal figures to tens of thousands per year.
Now it seems that the largest building society in the UK is taking action to tackle this problem.
Nationwide has announced that from 11 May 2017, leases must be for a minimum of 125 years for flats, and 250 years for houses, and that the maximum starting ground rent would be limited to 0.1% of the property’s value.
Nationwide has also stipulated that the ground rent must remain reasonable at all times and that multipliers which double the ground rent at regular intervals will not be permitted.
The building society will not be lending on properties which do not meet this criteria, which well mean that these otherwise very onerous lease terms will be curtailed.
Jan Samuel, senior partner at niche professional negligence litigation firm Samuels Solicitors, welcomes the news. Jan says “the problem of escalating ground rents is going to be an issue which bites lease holders over the next couple of decades. It is very good news that the Nationwide Building Society have taken this action and I hope that other lenders will follow suit”.
It is not all bad news for leaseholders however. Samuels Solicitors are currently investigating cases where leaseholders have not received the proper advice from the conveyancing solicitors, and were not aware just how onerous these clauses were before leases were signed.
Any losses which leaseholders have suffered as a result of failures by their conveyancing solicitors, could be recoverable as a professional negligence claim.
If you are the leaseholder of a property which is subject to onerous rent review clauses, and you were not made aware of these clauses by your conveyancing solicitors when you were purchasing your lease, it is possible that you may have a claim.
At Samuels Solicitors in Devon, we have a wealth of experience of bringing professional negligence claims against solicitors from all over the country, who have failed to advise their clients properly.
Contact us today for a free no obligation discussion about your matter.