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Government's 'flawed data' underestimates scale of leasehold home scandal by 50pc

Leasehold groups say the real figure is much higher - Getty Images Contributor
Leasehold groups say the real figure is much higher - Getty Images Contributor

The Government is accidentally underestimating the extent of the leasehold problem because official figures exclude millions of homes, according to new research. 

Many leasehold properties require expensive and unfair payments to be made to the freeholder. 

These can include a yearly ground rent that rises over time, leaving properties unsellable, as well as other high charges.

In December 2017, Sajid Javid, who was the Communities Secretary at the time, said the Government would set ground rent on all new long leases to zero.

But in a consultation last month the Government watered this down.

It now wants these to be allowed, but capped at £10 a year.

Campaigners for leasehold reform want stronger protections and now claim that government figures underplay the scale of the problem.

Official figures published by the Ministry of Housing, Communities and Local Government last month said there were 4.3m leasehold homes in England, or 18pc of the total housing stock.

However, according to statistics due to be published by the Leasehold Knowledge Partnership (LKP), a pressure group, the true number is 6.5m, 51pc higher.

Martin Boyd, of the LKP, said a third of all leasehold homes, or 2.21m, would have some sort of issue with unfair terms.

Mr Boyd said the government methodology was “total horsefeathers” and led to figures that underestimated the problem.

He said: “Unless you’ve got the right numbers, how do you plan properly?” 

The main reason for the gap is because the Government excludes many leasehold social homes.

Government figures say there are 244,000 of these, whereas the LKP says there are as many as 1.9m.

Government statistics also said there were no new leasehold homes built in 2016-17.

The LKP said there were around 50,000.

Jo Derbyshire, of the National Leasehold Campaign, an action group, said elderly and social leaseholders were among the most affected.