Workington MP Sue Hayman has backed new plans to bring justice to constituents affected by the leasehold scandal.

A newly-released Labour report includes proposals to cap unfair costs such as ground rents, investigate mis-selling, and save local leaseholders thousands of pounds.

Leasehold ownership means purchasing a home for the duration of a long lease rather than owning it outright.

Homeowners who purchase a leasehold property are often faced with extortionate charges in the form of ‘ground rents’ or service charges and locked into restrictive contracts which were not properly explained.

New figures show an estimated 13 per cent of homes in Workington constituency were sold as leasehold last year.

Reforms to leasehold promised by the Government have still not been implemented, two years after they were first proposed.

The plans, set out in a consultation yesterday by Shadow Housing Secretary John Healey MP, include a ban on the sale of new leasehold houses and flats.

Leaseholders will be able to buy the full, freehold ownership of their home for one per cent of the property value, with ground rents in existing leaseholds capped at 0.1 per cent of the property value, up to a maximum of £250 a year.

Labour’s proposals mean the average household in Workington constituency would see their annual ground rent capped at £150, with the cost of buying their freehold reduced to just £1,500.

Other proposals set out by Labour include:

  • A crackdown on unfair fees and contract terms, and a right to challenge unfair fees or poor service.
  • New rights to empower leaseholders to hire and fire their managing agent, or to take over management of their homes themselves.
  • A promise to revitalise commonhold: an alternative to leasehold – forms of which are used successfully across the world.

The report also renews Labour’s calls for a full public inquiry into mis-selling in the leasehold market which saw thousands of properties sold with extortionate terms such as doubling ground rents, making them unsellable.

Sue said: “Issues around leaseholds have been a common problem in my constituency surgeries. Leaseholders have everything stacked against them. Too often they suffer extortionate fees, appalling service and restrictive contract terms, and no way to easily challenge them.

“England is one of the only places in the world which has failed to move away from this feudal system. Across the world, modern alternatives like commonhold have flourished.

“I’m really pleased that Labour has committed to improve and revitalise commonhold for flats, and make freehold mandatory for all new houses, as the Government should have done years ago.”