22nd Dec 2021 09:25
(Alliance News) - Taylor Wimpey PLC has committed to removing terms from contracts that double ground rents for leaseholders every 10 years, the UK Competition & Markets Authority confirmed Wednesday.
Taylor Wimpey said the CMA investigation into the historical sale of leasehold properties with doubling ground rent clauses by the company is closed, following the agreement of voluntary undertakings.
The High Wycombe-based housebuilder said the cost of the undertakings falls within the original provision Taylor Wimpey made in 2017. By entering into the undertakings there is no finding that Taylor Wimpey has infringed UK consumer law, it noted.
Chief Executive Officer Pete Redfern said: "Taylor Wimpey has always sought to do the right thing by its customers, shareholders and other stakeholders, and we are pleased that today's voluntary undertakings will draw this issue to a full close, within our original financial provision."
In what the CMA described as a "victory for leaseholders", Taylor Wimpey confirmed that it has stopped selling leasehold properties with doubling ground rent clauses. The company's leaseholders will now see their ground rents remain at the original amount when the property was first sold.
CMA Chief Executive Andrea Coscelli said: "This is a huge step forward for leaseholders with Taylor Wimpey, who will no longer be subject to doubling ground rents. These are totally unwarranted obligations that lead to people being trapped in their homes, struggling to sell or obtain a mortgage."
The move by the regulator comes after the CMA launched enforcement action against four housing developers in September 2020. These were Countryside Properties PLC and Taylor Wimpey, for using possibly unfair contract terms, alongside Barratt Developments PLC and Persimmon PLC over the possible mis-selling of leasehold homes
Shares in Taylor Wimpey were up marginally in London on Wednesday at 169.85 pence each.
By Will Paige; [email protected]
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