#Michael Govem rishi sunak

[eaglesnick]

Sunak: puppet on a string.

Britain has both freehold and leasehold homes, the former being where the buyer owns both the house and the land it is built on.  Under leasehold arrangements the buyer does not own the land the house is built on and they must pay “ground rent" to whoever owns the land.

Leasehold properties have been described as “last redoubt of a colonial relic". Whereas most civilised countries have abandoned this “feudal” system of property ownership, here in England it has enjoyed a  resurgence in recent years.

In 1996, just 22% of UK new-builds were leasehold but by 2017 this figure had risen to 43%. Leaseholds have  continued to rise, the governments own figures stating there were nearly 5 million homes that were leasehold at the beginning of 2022.

In the past it was mainly apartments that were leasehold, and it was not uncommon for leasehold agreements to be set for 999 years. In addition, leasehold property owners were often only charged a  “peppercorn” rent.  This gave the leasehold tenant a certain amount of long-term security. This has changed dramatically in recent years.

Greedy housing developers have been selling leasehold properties with hidden clauses that allow 10-year renewal dates for ground rent increases.

“Although unsuspecting first-time buyers were frequently told that 999 year leases were “virtually freehold”, the clauses meant that the ground rent would soon spiral to absurd levels. The government quotes a family house where the ground rent is expected to hit £10,000 a year by 2060.” (Guardian: 25/07/17)

Such was the outcry at the unbridled greed of property developers and others who were the beneficiaries of this scandalous affair that:

“…government pledges to make it cheaper to extend leases and cut ground rents. Homeowners will be able to extend their leases by 990 years under new plans."  (Which: 07/01/21)

Michael Gove, Secretary of State for Levelling Up, Housing and Communities and Minister for Intergovernmental Relations, reiterated this promise, at the beginning of the year:

“What are leaseholds: Michael Gove vows to scrap the system. Gove’s new pledge could help millions of homeowners struggling with costly leaseholds” (Evening Standard: 31/01/23)

That was then. This is now.

“Plans to abolish leaseholds in England and Wales have been dropped after a row between Michael Gove and Downing Street.”  (Metro: 11/05/23)

Put simply, the rich backers of the Tory party are totally opposed to giving up the rich cow that is leasehold ground rents. Gove might be an honourable man on this occasion, and trying to do the “right thing”, but Rishi Sunak is not. He has caved in to his rich and powerful backers, and it is ordinary working families who will, as always, have to pay the price.