A Mirror investigation found Sushil and Anjana Patel demanded £ 28,000 in 2017 for one freehold they had bought for £ 4,000 at auction before a tribunal ruled it should be £ 5,100. It comes after the Tory government was accused of dragging its feet on leasehold reform
Priti Patel’s landlord parents have overpriced three freehold properties by tens of thousands of pounds forcing leaseholders who want to buy them to take them to a tribunal, we can reveal.
A Mirror investigation has found that Sushil and Anjana Patel demanded one leasehold tenant pay more than £ 28,000 for the freehold the Patels had bought for around £ 4,000 at auction. A tribunal judge later ruled they had made a mistake and it should be £ 5,100 – just £ 31 more than the tenants had offered the Patels 12 months earlier.
We found it was not an isolated case. The Patels asked for £ 7,500 from a second tenant in 2020, before a tribunal ruled it should be £ 5,751. Mr Patel wanted £ 17,000 for another freehold he owned in 1993 but, after a three year legal battle, a judge said the price should be just £ 2,750.
The government is accused of failing to follow through on promises to reform the current system which campaigners claim leave leaseholders at the “mercy” of investors who try to profit from the freehold on their homes.
Ministers have promised to make it “easier and cheaper” for leaseholders to buy their freehold – but there was no specific Bill to do this in the Queen’s Speech.
Katie Kendrick, founder of the National Leasehold Campaign, told the Mirror: “In this situation the leaseholder was left with no other option and was forced to a tribunal to challenge the premium.
“The process of challenging at tribunal is daunting, stressful and costly for leaseholders as their legal fees mount up.”
Our investigation has found that the Patels have invested in property for at least 30 years, including the freehold for five terraced houses in Kidderminster, bought at auction for £ 20,250 in 2015.
The leasehold owners of one of the houses, Michael Nock and his wife, served the paperwork to buy the freehold of their property in December 2017.
A young couple who had been renting the property for five years wanted to buy it but the remaining lease was too short for them to get a mortgage.
The Patels demanded £ 28,435 for the freehold – which would have netted them a 600% profit on an investment that had cost them barely £ 4,000 – but the Nocks refused, having had it valued at £ 5,069.
They were forced to take the case to a tribunal where the judge “preferred” the evidence of their valuer and said the Patels “misunderstood” the rules on valuing freeholds.
The Nocks were told they should pay £ 5,100 for the freehold, just £ 31 more than they had offered and just 18% of what the Patels were demanding.
Mr Nock told the Mirror that it had been an expensive tribunal which had cost him more in solicitors and surveyor fees than he had saved.
But he did not regret fighting his case: “If they had just said give us £ 8,000 instead of £ 5,000, I would have. But they just refused. They basically just said if you want to buy this take us to a tribunal. “
Mr Nock’s next door neighbors attempted to buy their freehold from the Patels in 2020 but that too ended up in court.
The tribunal said: “The parties were unable to agree the price of the freehold interest.”
The Patels “made no formal submission” but “referred to a private agreement made for the sale of the freehold” of two neighboring homes for £ 7,500 and £ 8,000.
But the tribunal judge agreed with the tenants, who had obtained a professional valuation that the freehold was worth £ 5,751, and ruled this was the “price payable”.
A third couple asked Mr Patel if they could buy the freehold of this three-bedroom house in Abbey Wood, London, in 1993.
They offered £ 2,610 but Mr Patel, who owned the property, demanded £ 17,000. Two months later he lowered the price to £ 15,000, but the leaseholders still refused.
It went to a tribunal but Mr Patel faxed the tribunal to say that he was out of the country. A new tribunal hearing was held but Mr Patel did not respond to “any of the five letters sent by the tribunal to Mr Patel’s address”.
After a valuation report and a visit to the property, the judge ruled that the price should be £ 2,750 – only £ 140 more than the tenants offered but just 16% of what Mr Patel had originally demanded.
The whole process took more than three years.
Katie Kendrick, of the National Leasehold Campaign, added: “Freeholders have been using the leasehold system to exploit leaseholders for far too long.”
She said it was “hugely disappointing for millions of leaseholders” that Government plans to “make it easier, cheaper and quicker for leaseholders to buy their freeholds” were not prioritized in this week’s Queen’s Speech.
When approached for comment at his North London home, Mr Patel refused to discuss the leasehold disputes and told our reporter to “get lost”.
Later, the Patels, through their lawyers Carter Ruck, did not comment.
The family are originally from Gujarat, India, before moving to Uganda and then on to the UK, where they opened a chain of newsagents in Hertfordshire.
Sushil Patel stood as a UKIP candidate in 2013.