An aristocratic relative of David Cameron faced a backlash last night over his opposition to a Government crackdown on toxic leases.
William Waldorf Astor IV, the half-brother of the former Prime Minister’s wife Samantha, has campaigned against plans announced yesterday to slash ground rent to zero on new houses and flats.
The 38-year-old’s fund management company, Long Harbour, has the freeholds of more than 160,000 homes – with investors making money out of the ground rents.
Long Harbour has claimed slashing ground rents on new homes could devastate UK building.
Under fire: William Astor, pictured with is wife Lohralee, faced a backlash last night over his opposition to a government crackdown on toxic leases
But one housebuilding executive told the Mail: ‘These people don’t represent the industry and they’ve displayed staggering ineptitude in their desperate attempts to stop the inevitable end of leasehold.’
Announcing plans to ban leaseholds on almost all new-build houses and fix ground rents, communities secretary Sajid Javid said: ‘Real action is needed to end these feudal practices.’
One developer that Long Harbour deals with, McCarthy & Stone, which sells the freeholds on homes it builds for the retired, spoke out against the reforms as its shares fell 9.5 per cent.
Other builders saw their shares also dip. The Mail has led the way in exposing abuses of leasehold, including clauses that mean ground rents double every decade.
Retirement developers such as McCarthy & Stone have argued they are a special case, because their ground rents do not rise aggressively and are used to maintain large communal areas for elderly homeowners.
Its chief executive Clive Fenton said: ‘The proposal will result in a disruption of housing supply and contradicts the stated objective of seeking new sources of housing.’
But there was little sympathy for investors who buy the freeholds of houses and flats.
Tory MP Andrew Selous said: ‘The Government has come to the protection of people who had unfair conditions imposed upon them and I don’t think investors have a leg to stand on from these morally questionable investments.’
HOUSING BOSS TOLD TO HAND BACK £130m
The boss of one of Britain’s biggest housebuilders was last night urged to give up his £130million bonus after profiting from the sale of leasehold homes.
Jeff Fairburn, the chief executive of Persimmon, is in line for the payout as part of a package that will see 150 managers share more than £800million.
But critics said business has been boosted by the sale of new homes with leases, as well as the Government’s Help to Buy scheme that offers taxpayers’ cash to secure a mortgage.
One in six Persimmon homes has a lease, meaning buyers pay an annual fee to the freeholder.
Sebastian O’Kelly, director of the Leasehold Knowledge Partnership campaign group, said: ‘The best thing they could do is turn down these bonuses and stop being so greedy.’
Liberal Democrat leader Sir Vince Cable said: ‘The scale of this bonus is obscene. It is reminiscent of the worst excesses of corporate greed that helped create the financial crisis.’
Long Harbour hired public relations firm Pagefield to lobby across Whitehall, warning that scrapping ground rents would lead to 20,000 fewer homes being built each year across the UK.
Long Harbour director Jack Spearman then emailed property executives this week asking them to sign an open letter to the Government expressing concerns about the shake-up. An industry source said: ‘If anything, it hardened the Government’s approach.’
Sebastian O’Kelly, of the Leasehold Knowledge Partnership group, said: ‘There was a bit of last-minute insider lobbying by Will Astor and, thank goodness, it has failed.’
Long Harbour said: ‘We have played a co-ordinating role over the past three months to engage with the Government constructively over leasehold reform.
‘We have outlined on multiple occasions the impact on UK housing supply if all ground rents were reduced to zero, and the value of an institutional freeholder.’
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