https://www.gov.uk
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- Affected leaseholders' ground rents will no longer increase and will remain at the amount charged when they first bought their home
- This comes after
Following CMA action, leaseholders with
Countryside will also remove terms which were originally doubling clauses but were converted so that the ground rent increased in line with the Retail Prices Index (RPI). The CMA believes the original terms were potentially unfair and should therefore have been fully removed, instead of being replaced with another term that still increases the ground rent.
The move comes after the CMA launched enforcement action against 4 housing developers in
Due to the CMA's action, affected Countryside leaseholders will now see their ground rents remain at the original amount - i.e. when the property was first sold - and this will not increase over time. Countryside also confirmed to the CMA that it has stopped selling leasehold properties with doubling ground rent clauses.
Leaseholders with Countryside can now breathe a sigh of relief knowing they will no longer be forced to pay these doubling ground rents. No one should feel like a prisoner in their home, trapped by terms that mean they can struggle to sell or mortgage their property. We will continue to robustly tackle developers and investors - as we have done over the past 2 years - to make sure that people aren't taken advantage of.
Other developers, such as
This is the kind of issue that could be resolved at pace and met with fines if the CMA receives the consumer powers that the Government is currently consulting on.
Housing Secretary
We asked the CMA to investigate the use of unfair practices in the housing market, such as doubling ground rents - and I welcome their continued success in bringing justice to homeowners.
This settlement with Countryside will mean thousands more leaseholders are given the fair treatment they deserve and marks the third major agreement with leading
We will continue to support leaseholders who may have been mis-sold properties and our new legislation will put an end to this practice for future homeowners, by restricting ground rents in new leases to zero.
As part of its review of the leasehold sector, the CMA is continuing to investigate investment groups
For more information on the CMA's ongoing work in the sector and for future updates, please visit the leasehold case page.
Notes to editors
1. These undertakings have been provided to the CMA voluntarily and without any admission of wrongdoing or liability. It should not be assumed that Countryside has breached the law - only a court can decide whether a breach has occurred.
2. Where Countryside has sold the freehold, and cannot remove clauses itself, then it will help get them removed at no cost to leaseholders. This will involve liaising with the current freeholder and making a financial contribution to the freeholder where they give formal commitments to the CMA to remove the clauses.
3. For people who own, or are looking to buy, a leasehold property, the CMA has produced written and video guidance, which offers advice on a number of issues, including what people can do when faced with fees and charges they consider unjustified.
4. The housing developers currently under investigation by the CMA are
5. The main provisions of consumer protection legislation relevant to the CMA's concerns about ground rent terms are the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs), for contracts entered into before
6. The main provisions of consumer protection legislation relevant to the CMA's concerns about mis-selling are the Consumer Protection from Unfair Trading Regulations 2008 (CPRs). The CPRs aim to protect consumers from unfair commercial practices such as the misleading provision or omission of information as part of sales processes.
7. As an enforcer under Part 8 of the Enterprise Act 2002, the CMA cannot impose administrative fines for breaches of this consumer protection legislation, but it can enforce the legislation through the courts, and where appropriate, obtain additional measures to improve consumer choice, drive better compliance with the law, or obtain redress for consumers.
8. The CMA's investigation of potential mis-selling of leasehold properties has benefitted from the support of several local Trading Standards offices which have been the focal point for some consumers to raise their concerns.
9. All media enquiries should be directed to the CMA press office by email on press@cma.gov.uk, or by phone on 020 3738 6460.
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(C) 2021 M2 COMMUNICATIONS, source