Pensioner takes on housing giant over its leasehold ‘con’ after sales team failed to tell him he would not own the freehold when he bought £328,000 home
- Terry Dodd claims he was ‘conned’ into buying £327,750 home by Morris Homes
- Mr Dodd claims the Morris Homes sales team failed to reveal it was a leasehold property, rather than a freehold
- Other residents on the 28-home upmarket estate say they also had no idea they were not buying the freeholds to their homes until they moved in
A pensioner is taking legal action against one of Britain’s largest housebuilders in what could be a landmark case for thousands caught up in the leasehold scandal.
Terry Dodd, 70, claims he was ‘conned’ into buying a £327,750 four-bedroom detached home by Morris Homes because its sales team failed to reveal it was a leasehold property, rather than a freehold.
Other residents on the 28-home upmarket estate say they also had no idea they were not buying the freeholds to their homes until they moved in.
Terry Dodd, 70, claims he was ‘conned’ into buying a £327,750 four-bedroom detached home by Morris Homes because its sales team failed to reveal it was a leasehold property, rather than a freehold
Instead Morris Homes sold the freeholds to third-party firms which have demanded £300 annual ground rent, set to double every decade, for 999 years. These firms have also been accused of trying to sting residents for minor alterations, such as changing windows and front doors.
Now a judge has given the green light for Mr Dodd to have his case heard at trial in June. He is suing Morris Homes for £10,000 in the small claims court, alleging that he was mis-sold the house in Saughall, near Chester. The firm denies mis-selling the properties.
If he wins it could set a precedent for the estimated 100,000 other families thought to be caught in the ‘leasehold trap’.
Mr Dodd, who runs a roofing business, bought his home in September 2015. ‘Nowhere on the paperwork did it say I was buying the leasehold and not the freehold,’ he said. ‘If I had realised it was a leasehold property I would never have considered buying it.’
Other residents (pictured with Terry Dodd centre) on the 28-home upmarket estate say they also had no idea they were not buying the freeholds to their homes until they moved in
Other residents on the estate claim they only realised they didn’t own the freehold after they moved in and started receiving letters from firms demanding ground rent. All fear their properties are worthless because buyers are reluctant to purchase leasehold homes.
Teacher Stephen Moffatt, who lives on the estate with his wife, said they believed they were ‘mis-sold’ their home. He said no Morris Homes sales adviser and none of the firm’s marketing material mentioned that the property was leasehold. Instead, on the day of completion his solicitor alerted them.
Mr Moffatt said they were then reassured by the firm that they would have the chance to buy the freehold after two years for £3,000. But when he wrote to the freehold owner he was quoted £7,150. He said they could not afford that lump sum, adding: ‘We are therefore still locked into our leasehold nightmare.’
Last month Morris Homes tried to have Mr Dodd’s case thrown out on a technicality after it emerged that the £335 trial fee he had been ordered to pay had got lost in the post.
Terry Dodd is suing Morris Homes for £10,000 in the small claims court, alleging that he was mis-sold the house in Saughall, near Chester. Pictured: The housing estate
But Deputy District Judge Brown, sitting at Chester Civil Justice Centre, said it would be wrong to deny Mr Dodd his day in court. He said he believed he had posted the cheque.
In 2019 the Government banned the sale of new-build leasehold houses to protect families from rocketing ground rent charges.
The Competition and Markets Authority regulator has vowed to crack down on home builders responsible for tying homeowners into the leasehold nightmare.
Mr Dodd eventually sold his home to his daughter, Holly, at a £23,000 loss. But he said he is determined to fight Morris Homes in court to highlight the issue and to help his daughter protect her financial future.
A spokesman for Morris Homes said: ‘We have in the past sold properties on a 999-year-long leasehold basis in the north-west of England. Purchasers are always offered the opportunity to purchase the freehold at point of sale.
‘Mr Dodd was advised by his own solicitors, who accepted the terms of the sales. We believe that he resold the property within two years of his purchase and incurred no loss. We have received no similar complaints on this development.’
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