Leasehold house prices

Leasehold house prices rise faster than freehold

The price of leasehold housing has increased at double the rate of freehold properties, new research has shown.

According to independent estate agent James Pendleton, the average price of a leasehold property jumped 4.3% to £256,117 in 2017 (2016: £245,471).

Meanwhile, freehold property prices rose by a mere 2% to an average of £306,557 this year (2016: £300,553).

Earlier this year, the government announced it had set out plans to ban new-build houses from being sold as leasehold and restrict ground rents to as low as zero.

Lucy Pendleton, founder director of James Pendleton, said: “No one buys a leasehold house out of choice and this just goes to show what can happen when there is too much competition for too few properties.

“Developers have realised the commercial value of leases and they have become a ticket for profiteers who are able to take advantage of buyers with little choice, but to proceed to get their foot on the ladder.

“My added fear is that a lot of these transactions will have been made by those using the Help to Buy scheme, which means they are likely to be first-time buyers less aware of the downside of taking on open-ended leases on homes that should be freehold.”

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