Homeowners stuck with expensive leasehold agreements could soon have an escape route, as the competition watchdog launches a probe into these often crippling charges.
In the most serious cases, leaseholders are forced to pay hundreds of pounds per year in ground rent, with payments doubling every 10 years. These charges often make it difficult to sell a property, as few people wish to buy a home subject to such an onerous contract.
The Competition and Markets Authority (CMA) has now launched a formal investigation into leasehold agreements amid fears that homeowners are not being treated poorly.
Serious concerns have been raised about whether the terms applied under such leasehold agreements are fair. Some apply a string of administration and service charges on top of the ground rent itself.
The CMA said it would also examine whether leaseholders may have been mis-sold when they purchased their property in the first place.