Plans to ban leaseholds on new-build houses in England

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“Unfair charges” levied on buyers of new-build houses could be banned in England under a proposed crackdown.

Leaseholds on new-build houses would be outlawed, while ground rents could be dramatically reduced, under government plans subject to public consultation.

Ground rents can double every decade, crippling home owners and in some cases making a property impossible to sell.

“Enough is enough. These practices are unjust, unnecessary and need to stop,” said Communities Secretary Sajid Javid.

The proposals, which are subject to an eight-week consultation, apply only to England.

The leasehold system has existed for a long time in England and Wales, especially in blocks of flats.

Leaseholders own their homes for a fixed period of time, on a “lease” to a freeholder, but many have long leases, for example for many decades, and experience no problems.

Traditionally houses have nearly always been sold as freehold properties, meaning the buyer owns the building and land it is built on outright.

But the trend for new-build houses being sold as leasehold has accelerated in recent years.

Katie’s story: ‘My biggest mistake’

Katie Kendrick bought her new-build home from Bellway in Ellesmere Port, Cheshire, three years ago for £214,000.

“It’s the biggest mistake I’ve ever made,” she told the BBC.

Katie knew the house was leasehold – meaning she owned the property for the 150-year length of her lease agreement. But she claims she was told by the sales representative that because of the long lease it was “as good as freehold” – a property owned outright.

She thought nothing of it, and says she was told she would be able to buy her freehold after two years, believing it would cost between £2,000 and £4,000.

But a year and a half later, she received a letter from Bellway saying her freehold had been sold to an investment company, which was now quoting £13,300 for her to buy it.

What Bellway did – selling a new home as leasehold, and then selling the freehold separately to an investment company without informing the family living there – is not illegal.

The government said it was a particular problem in the north-west of England.

Leaseholders typically pay ground rent to the freeholder, but can be caught out by clauses allowing for dramatic increases in these fees, which come on top of management charges for the upkeep of communal areas.

The Department for Communities and Local Government (DCLG) said the terms of some leases “were becoming increasingly onerous”.

It cited examples of:

  • A homeowner being charged £1,500 by the freeholding company to make a small change to their family home
  • A family home which is now impossible to sell because the ground rent is expected to hit £10,000 a year by 2060
  • A homeowner who was told buying the lease would cost £2,000 but the bill came to £40,000

MPs have described the situation as a “national scandal” and the “PPI of the housebuilding industry”.

The DCLG said its proposals aimed to make future leases fairer by reducing ground rents so they “relate to real costs incurred”.

About 21% of private housing in England is owned by leaseholders, with 30% of those properties houses rather than flats, according to figures from the Department for Communities and Local Government.


Police costs set to rise by as much as five per cent

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The amount paid by households towards the cost of policing looks set to rise by up to five per cent this year as the Government faces a potential show down with its flagship Police and Crime Commissioners (PCCs) who are demanding above inflation increases in council tax to combat swingeing budget cuts.

Yesterday Greater Manchester Police became the latest major force to signal it would be seeking a rise in bills which it said would fund the equivalent of 100 community support officers.

Police and Crime Commissioner Tony Lloyd warned that without the anticipated £5 rise (the equivalent of three per cent) on annual bills for band D homes, the force – the third largest in England – was “standing on the edge of a cliff” as it faces £100m in cuts having already lost a quarter of its budget.

All but four of the 41 directly elected police and crime commissioners are seeking extra cash from local people already struggling to cope with the cost of living crisis as they seek to combat steep falls in the amount of money made available from Whitehall.

But despite being required by law to set a new budget one senior PCC they are in the “ridiculous situation” of having yet to be told by ministers how much extra money they can raise without triggering a referendum under the Localism Act.

Local government minister Brandon Lewis again urged voters to veto excessive rises in council tax describing those that sought more money as “democracy dodgers”.

He said: “Local referendums could be held this year on the same day as the European elections at minimal cost and inconvenience. If they aren’t going to freeze council tax, local authorities should trust the people and let taxpayers’ decide.”

London Mayor Boris Johnson, who oversees the Metropolitan Police budget, is among those ordering a freeze on annual increases through the council tax although he has yet to finalise the budget for the capital which does not have a PCC.

Mr Lloyd said Government cuts were “endangering public safety” and that 1,100 officers had been shed in Greater Manchester since 2010. He added: “The Chief Constable has told me that he cannot provide the levels of policing that Greater Manchester people expect and deserve if this programme of cuts goes beyond 2017. There simply will not be enough money in the pot.”

West Midlands PCC Bob Jones is seeking a three per cent increase whilst Alun Michael in South Wales has won approval for an additional five per cent although he answers to the Labour-run Welsh Assembly.

The contribution paid towards policing through local taxation is around a quarter of the overall funding in England and wales. It appears on the household’s annual bill alongside the amount required to fund the council and fire and rescue services. Figures can vary dramatically. The average amount paid towards policing is £170 a year. The lowest is around £100 whilst others levy twice as much, with Londoners paying £216 in 2013/14.

The commissioners must discuss their plans with their local crime panels before gaining Government approval. Councils, which cannot raise council tax by more than two per cent without triggering a referendum, fear the electoral fall out from any increases in annual bills will result in voters punishing politicians.


Snow and strong winds set to batter UK

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Frequent snow showers and strong winds are set to sweep across the UK on Thursday with daytime highs of just 2C to 5C.

Forecasters warned it will feel even colder with gale-force winds and a polar airmass, which originated over northern Canada, spreading south across the country. The blizzard conditions are expected widely across Scotland, Northern Ireland, Wales and the north of England, with the possibility of sleet or snow for a short time in the south of the UK. It follows a wet and windy day on Wednesday for Scotland and the north of England that left homes without power and major travel disruption. The Forth Road Bridge that connects Edinburgh and Fife was closed all day after a lorry was blown over and damaged the central reservation. A gust of 93mph was recorded at High Bradfield in South Yorkshire and 82mph at Emley Moor in West Yorkshire.

Engineers worked to reconnect thousands of homes in Yorkshire, Cumbria, Cheshire and the north of Scotland and will be on standby throughout Thursday. Paul Gundersen, chief meteorologist at the Met Office, said the heaviest and most frequent snow showers are likely across northern and western Scotland, Northern Ireland and around Irish Sea coasts, but eastern coasts will also be affected in the coming days. “Most northern areas are very likely to see snow showers at times over the next few days, but the situation over the southern half of England is more complicated,” he said. “Southern counties of England and Wales can expect a cold and wet day with some heavy rain on Thursday, but there’s an increasing chance this will turn to sleet or snow, especially over hills, during the afternoon and evening.

“There is a chance of snow settling bringing disruption to transport during the evening rush hour and possibly interruptions to power supplies, this more likely across East Anglia and south-east England. As skies clear on Thursday night it is likely to become icy in many areas. “Forecasting snow is always challenging and there’s often a fine line between whether it will rain or snow in a particular location depending on slight changes in air temperature. Keep an eye on the forecast and warnings for your area for the latest information.” The Energy Networks Association has reminded people they can call 105 – the new, free national phone line – if the weather damages their local power network and affects their electricity supply.

 


Liz Truss urged by Bar Council to condemn Brexit ruling backlash

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New Lord Chancellor installed

The Bar Council joins calls for the Government to defend the judiciary’s independence after three judges were heavily criticised. Justice Secretary Liz Truss is being urged to condemn “serious and unjustified attacks on the judiciary” following a High Court ruling over Brexit. The Bar Council has joined calls for the Government to defend the judiciary’s independence after three judges were heavily criticised by some Tory MPs and sections of the media. The trio ruled on Thursday the Government must seek MPs’ approval before triggering Article 50 – the formal process of leaving the EU.

The Daily Mail called the judges “enemies of the people” while the Daily Express claimed the ruling was a marker of “the day democracy died”. The Bar Council, which represents barristers in England and Wales, condemned the attacks and called upon Lord Chancellor Ms Truss to do the same. It said: “A strong independent judiciary is essential to a functioning democracy and to upholding the rule of law.” Ms Truss has not spoken on the matter since the court decision and Prime Minister Theresa May has also been urged to calm the backlash in the wake of the ruling. Ex-attorney general Dominic Grieve said the stinging criticism of the trio was “chilling and outrageous” and “smacks of the fascist state”. He said reading some of the press coverage was like “living in Robert Mugabe’s Zimbabwe … I think there’s a danger of a sort of mob psyche developing”.

Bob Neill, the Conservative chairman of the justice select committee, told The Times: “All ministers from the Prime Minister down must now make clear that the independence of the judiciary is fundamental to our democracy.” It comes as Labour leader Jeremy Corbyn demanded Mrs May set out her Brexit plans “without delay”. In a speech to the Class think-tank, he said Labour “accepted and respected” the EU vote result but called for the Government’s negotiating terms be transparent and accountable to Parliament. Mr Corbyn also insisted all UK businesses should be given “assurances” over the impact of Brexit to match those apparently made by the Government to Japanese car-maker Nissan.

On Friday, Mrs May suffered a setback after a pro-Brexit Conservative MP resigned over “irreconcilable policy differences” with the Government. Stephen Phillips announced he was quitting over what he perceived to be a failure to appreciate the need to consult Parliament over Brexit. His resignation as MP for Sleaford and North Hykeham has fuelled speculation the PM will call an early election. However, a Number 10 source insisted Mrs May stood by her declaration that she would not go to the country before 2020. Meanwhile, the woman behind the successful High Court challenge on triggering Brexit has been subjected to a torrent of online abuse, including rape and death threats.

Gina Miller, who was born in Guyana in South America, has also been the target of racist rants by internet trolls, who have called for her to be deported.

 


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