The Competition and Markets Authority has secured agreements from nine building firms that bought freeholds from Taylor Wimpy to remove their double ground rent terms, which will see a further 5,000 UK households receive refunds.

The watchdog says further action in its long-running investigation also means that four more developers – Crest Nicholson, Redrow, Miller Homes and Vistry – have also agreed to work with the companies who purchased their freeholds to remove doubling terms.

The CMA says: “All nine firms must now remove problematic contract terms that cause ground rents to double in price every 10 years.

“These terms can lead to people being trapped in homes they cannot sell or mortgage. The firms will also remove contract terms which were originally doubling clauses, but were converted so the ground rent increased in line with the retail price index.

It adds that these “doubling clauses were unfair and should therefore have been fully removed – not replaced with another term that still increases the rent”.

The clause saw homeowners with ground rent of around £300 doubling every 10 years.

The regulator says that all affected leaseholders will see their ground rents remain at the amount set when the property was first sold, which will not increase over time.

The nine freeholders have also agreed to refund residential leaseholders who had already paid out under doubled ground rent terms.

The regulator says this latest action in its ongoing investigation into ground rent cases, which began in 2019, has so far benefited over 20,000 households.

CMA interim chief executive Sarah Cardell says: “For years leaseholders have been plagued by what we believe are unfair practices. That’s why we sought to tackle the problem by launching action against some of the biggest names in the business.

“As a result of our work, over 20,000 people now have a new lease of life, freed from issues like costly doubling ground rent terms.”

Secretary of State for Levelling Up Greg Clark adds: “This is good news that will see thousands of leaseholders get the refunds they are entitled to.

“Levelling up home ownership and creating a fairer, more transparent leasehold system is a top priority for this government, and these agreements are an example of this in action.

“We will work with the CMA to continue challenging the industry on its practices, so we can ensure more leaseholders get the fair deal they deserve.”

The nine firms who purchased freeholds from Taylor Wimpey and have provided undertakings are: BDP Freehold, Mortgage Incentive Funds, The Bridges (Darlington) Management Company, Bessant Properties, Brigante Properties, Furatto Limited and Long Term Reversions No 1 (treated as a single entity), SF Ground Rents No 18, SF Ground Rents No 15 Limited and RMB 102 (treated as a single entity), Sarum Properties and Taylor Court.

The CMA says that is still in talks with five groups who purchased freeholds from Taylor Wimpey that have not provided ground rent undertakings.

These are: Island Apartments Freehold, Madison Close Freeholders, Elmdon Real Estate LLP, Abacus Land 1 (Holdco 1) Limited, Abacus Land 4 Limited and Adriatic Land 1 (GR3) Limited (part of the Abacus Land and Adriatic Land investment group) and Plaza 2 Surbiton.