Persimmon in voluntary agreement with CMA over leaseholds

Housebuilder Persimmon has agreed a number of voluntary informal undertakings relating to its historic sale of leasehold houses with the competition watchdog.

Persimmon says it has not historically sold leasehold houses in high volumes.

The York-based firm says that the voluntary agreement brings brings to an end its involvement in an ongoing Competition and Markets Authority (CMA) investigation into leaseholds.

Persimmon stopped selling leasehold houses in 2017 and introduced a Right to Buy scheme enabling customers with leasehold houses to buy their freehold at a price below market value.

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The firm has agreed an extension of its existing Right to Buy scheme to cap the purchase price of a freehold at £2,000. The extended scheme will apply to any house leases sold on or after January 1, 2000, and runs until December 31, 2026.

Customers who have already acquired their freeholds from Persimmon under the existing Right to Buy scheme, and who still own the freehold, can also apply to be reimbursed for the difference between the price paid and £2,000.

It has also extended its Reservation Period for home buyers from 35 days to 42 days.

Dean Finch, group chief executive of Persimmon, said: "Persimmon has not historically sold leasehold houses in high volumes and introduced a Right to Buy scheme for leaseholders in 2017.

"However, we are committed to putting our customers first and have voluntarily agreed to extend this existing support to provide further certainty and reassurance.

"Building on our existing Right to Buy scheme, this agreement provides a fair deal for all leaseholders of Persimmon built houses, extending the opportunity to purchase their freehold at a price well below market value.

"Today's agreement further demonstrates Persimmon's determination to operate with integrity as we continue to build a business with a long-term, responsible and sustainable future."

The CMA launched enforcement action against four housing developers in September 2020. Aviva is another firm that has also signed a voluntary agreement that will see it remove from leasehold contracts certain clauses.

Andrea Coscelli, chief executive of the CMA, said: "This is a real win for thousands of leaseholders - for too long people have found themselves trapped in homes they can struggle to sell or been faced with unexpectedly high prices to buy their freehold. Now, they can breathe a sigh of relief knowing things are set to change for the better.

"It's good that Aviva and Persimmon have responded positively to this investigation, enabling these issues to be fixed for leaseholders. But our work isn't done. We now expect other housing developers and investors to follow the lead of Aviva and Persimmon. If not, they can expect to face legal action."

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