In a significant move, King Charles has unveiled a Leasehold and Freehold Bill, aiming to ban leaseholds for new houses in England and Wales while leaving existing flats untouched. The Conservatives pledge that all new homes in these regions will be sold as freehold properties, including a 990-year standard lease extension and capping ground rents on existing leaseholds to a peppercorn.
Levelling Up Secretary Michael Gove leads the charge to eliminate the "feudal" leasehold system, introducing changes like scrapping the two-year residency requirement for lease extension proposals. The government has also pledged with insurance brokers to reduce premiums for leaseholders in fire-affected buildings, capping broker compensation at 15%.
However, scepticism exists about the effectiveness of these reforms. The Renters Reform Bill will carry over, retaining Section 21 until the possession process is modernised. Critics, including Jeremy Raj from Irwin Mitchell, express disappointment, citing the failure to address fundamental housing market issues like supply shortages and affordability.
The National Leasehold Campaign (NLC) welcomes the reforms but deems them insufficient. Founder Katie Kendrick highlights concerns over high service charges and the absence of a complete leasehold ban.
As the government pushes forward, the debate on leasehold reforms continues, raising questions about whether these proposals are a game-changer or merely an initial step in a broader reform agenda. Striking a balance between immediate concerns and addressing systemic challenges in the housing market will be crucial moving forward.
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Information gathered from Today's Conveyancer, see here.