Persimmon and Aviva agree moves over UK ground rent and lease terms

British competition regulator suggested measures as part of investigation

Aviva will remove “unfair” ground rent terms and repay owners whose rents were doubled, while Persimmon will offer leasehold owners an option to get complete ownership of the property at lower rates. Photograph: iStock

Aviva will remove “unfair” ground rent terms and repay owners whose rents were doubled, while Persimmon will offer leasehold owners an option to get complete ownership of the property at lower rates. Photograph: iStock

 

Housebuilder Persimmon and insurer Aviva have agreed to measures suggested by Britain’s competition regulator as part of its long-running investigation into possible mis-selling of leasehold homes and high ground rents.

Aviva will remove “unfair” ground rent terms and repay owners whose rents were doubled, while Persimmon will offer leasehold owners an option to get complete ownership of the property at lower rates, the Competition and Markets Authority (CMA) said on Wednesday.

The regulator launched the probe in September last year, with cases against Barratt Developments, Persimmon, Taylor Wimpey and Countryside Properties.

CMA in March asked Taylor Wimpey and Countryside to drop the unfair rent terms. Both companies then said they would cooperate with the regulator.

CMA said on Wednesday it was also investigating several investment firms which bought freeholds from two developers and used the same terms, adding that Persimmon also agreed to extend the time during which buyers can exchange contracts after reserving a property.

Persimmon said the undertakings with the regulator formally end the probe into the company, while Aviva said one of its funds had agreed to amend terms for around 1,000 leases it had acquired. – Reuters