U.K. Watchdog Finds ‘Troubling Evidence’ of Leasehold Misselling
U.K. Watchdog Finds ‘Troubling Evidence’ of Leasehold Misselling
(Bloomberg) -- The U.K. Competition and Markets Authority said it found “troubling evidence” that people buying a leasehold property may have been unfairly treated and misled by housing developers.
“We’ll be looking carefully at the problems we’ve found, which include escalating ground rents and misleading information, and will be taking our own enforcement action directly in the sector shortly,” Andrea Coscelli, chief executive of the CMA, said in a statement on Friday.
The U.K. regulator’s concerns include possible unreasonable fees for buyers, misleading information about the implications of buying a leasehold property, or high ground rents built into contracts.
The practice of selling leasehold properties, a relic of an archaic system where property is sold to buyers for a fixed time period, remains popular in the U.K., especially in London. Most homes are sold on a freehold basis in countries such as the U.S., where buyers can own the underlying property indefinitely.
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To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Peter Chapman
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