Commonhold White Paper – Thoughts from the Industry
The sale of new leasehold flats in England and Wales is to be banned under Labour’s plan to end the ‘feudal’ system. Labour wants to switch to Scotland’s commonhold system
There are around 5 million leaseholders in England and Wales. Under commonhold, each flat owner would own the freehold of their home, but also have shared responsibility for common areas and upkeep. Here are some thoughts from the Industry.
Timothy Douglas, Head of Policy and Campaigns at Propertymark:
“Further reforms to the leasehold system will be welcome news for leaseholders up and down the country. Propertymark has long campaigned for changes to make it cheaper and easier to buy, sell and rent leasehold property. We know that there are complications and additional costs with extending leases and property with an escalating ground rent struggles to sell, so commonhold offers an opportunity to tackle these issues. With 42 per cent of Propertymark member agents favouring abolishing the leasehold system altogether, it’s clear to see there is frustration with the current system. However, understanding and awareness of the implications of commonhold is low. What’s key through the White Paper proposals is that any future changes make the system simpler, reduce costs and enable consumer confidence.”
Helen Hutchison, partner at Irwin Mitchell:
“Whilst we strongly agree there is a need to makes changes to the current leasehold regime, a rush to abolish leasehold ownership, without a clear plan will be risky and could potentially bring the market for leasehold flats to a halt. The sheer enormity of such a transition needs to be considered with input from those in the sector to put in place a staged process with a view to minimising risk. We await further proposals with interest and will of course be monitoring the situation closely.”
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