Group says proposed exemption will help it develop better facilities for retired people
Retirement homes builder McCarthy & Stone has welcomed proposals by the government to exempt properties built for retirees from a planned cap on ground rent.
The firm has long campaigned for the exemption, claiming the retirement sector capitalises the ground rent income “to recover much of the construction costs of the significant shared and communal areas within its developments that are integral to the retirement living lifestyle”.
“The proposal recognises the unique way the sector uses ground rents compared to the mainstream housebuilding industry,” it added.
The government said its consultation was seeking views on selling newly-built homes as freehold “by default” and why new ground rents should be capped at a nominal sum of £10 a year.
Ministers were prompted into action on ground rents after a number of controversial cases were highlighted last year, including buyers of Taylor Wimpey-built properties, where the ground rent was set to double every year, eventually costing homebuyers thousands of pounds annually.
Last year Taylor Wimpey set aside £130m to recompense affected customers.
John Tonkiss, McCarthy & Stone’s chief executive, said the announcement was “a positive step for the retirement community sector and, more importantly, our customers.
“However, we recognise that these are still proposals. We will continue to work closely with government and will respond to the consultation paper in due course.”
Secretary of State for Communities James Brokenshire said: “Unfair ground rents can turn a homeowner’s dream into a nightmare by hitting them in the back pocket and making their property harder to sell.
“That’s why I’m taking concrete action to protect homeowners and end those unscrupulous leasehold practices that can cost tenants hundreds of pounds.”
The leasehold consultation paper is available here.