MPs have backed a bill that will set the ground rent for new leasehold properties at 'one peppercorn' per year – but criticised conveyancing solicitors for failing to properly advise current leaseholders who now feel ‘trapped’ in their own home.
The Leasehold Reform (Ground Rent) Bill, which seeks to end ‘onerous’ ground rents, completed its second reading in the House of Commons yesterday.
During a lengthy debate, Labour’s Lucy Powell criticised the bill for not protecting existing leaseholders who currently face excessive ground rent increases and are unable to sell their home.
‘Does this not give rise to an extraordinary question about the legal advice provided by solicitors to those who made such purchases?’ replied Sir Desmond Swayne, Conservative MP for New Forest West.
Former housing secretary Robert Jenrick said conveyancing solicitors who failed to give advice in the sales process ‘failed in their duty to their clients’.
‘Many constituents have come to my surgeries who were oblivious about the homes that they were buying. That applies not only in the situation we have discussed, but with respect to management fees, which may be very high or may involve charges, for example for putting up a satellite dish, building a conservatory and so on. Conveyancing solicitors need to take much greater care to bring such matters to the attention of their clients.’
MPs also raised concerns that some people were told they had to use particular solicitors, in breach of Law Society guidelines, and some were told they had to complete within a certain period of time so may not have had sufficient time to analyse and understand the documents correctly.
The Conservative’s Stephen Hammond suggested ministers engage the Solicitors Regulation Authority on the concerns raised.
Housing minister Christopher Pincher said the bill was narrowly defined ‘so that we can get on and deal with the most egregious offences on ground rents and then move on to the more complicated matter of wider leasehold reform.’
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