PROPERTY management groups which have snapped up freeholds on thousands of East Lancashire houses were today blasted for pressuring homeowners for money.

Burnley MP Peter Pike is warning householders to be on their guard against the "bullying" tactics of some freeholders and is backing government reform of the leasehold system.

He is advising anyone who receives a letter from such a company to hold fire and get advice.

Large numbers of terrace houses are on 999-year leases, commanding nominal annual ground rents.

Mr Pike said some freeholders have exploited their position to bully and frighten people to pay money before proceeding with a notification of change of ownership and to extract cash for alterations or extensions to properties.

In one area of Padiham, sums of £250 and in one case £800 have been demanded in retrospective payment for alterations carried out without permission.

The person paid the £800 because otherwise they could have missed out on the sale of the property.

He says: "Many people, particularly older people, feel pressured and pay up demands rather than risk forfeiture. "Also some people who bought out the ground rent now find they did not acquire the freehold title."

In a case this week, a householder in the Casterton area of Burnley was asked to pay £2 for rent outstanding even though the requirement to pay ground rent had been bought many years ago.

The company also asked for £352, inclusive of legal , administrative and Land Registry fees to buy the freehold.

Mr Pike said his current advice to people was to buy the freehold if the price was reasonable, to avoid any possible future hassle.

He added: "The whole problem is a complex issue. Government is currently putting out draft proposals to deal with these problems and in the interim people can see or write to me or contact their solicitor."

Mr Pike says that while the value of a 999-year lease can only be minimal, it is the freeholder who has ultimate power and decides what the leaseholder can or cannot do.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.