Leasehold reforms are long overdue

National Federation of Builders 2021

Housing secretary, Robert Jenrick has announced leasehold reforms to end some of the bad practices seen in recent years, as well as make it easier for homeowners to buy their freeholds.

Richard Beresford, chief executive of the National Federation of Builders (NFB), said: “These long overdue changes must be the first of many to protect homeowners from the abhorrent behaviour of some unscrupulous companies. The NFB has been speaking to government about the leasehold scandal for many years and it’s good to finally see this Government take the issue seriously.”

Legislation will be brought forward to set future ground rents at zero for all leaseholders, allow leases to be extended by 990 years and create parity between house and flat leaseholders, as currently those who own a leasehold house can only extend their lease once, for a period of 50 years.

Further changes by way of a cap on ground rent payable and the introduction of an online calculator will help leaseholders plan to buy their freehold. Prohibitive costs, such as ‘marriage value’ – the difference in value between your property having a short lease (before renewing) and when the lease is extended or freehold bought – will be simplified and made more transparent.

Leaseholders will also be able to voluntarily agree to a restriction on future development of their property to avoid paying ‘development value’.

The Government will establish a Commonhold Council to prepare the nation for the introduction of commonhold.

Rico Wojtulewicz, head of housing and planning policy at the House Builders Association (HBA), said: “It was about time the issues around leasehold were tackled, not only because it was wholly unfair to those purchasers who were trapped by unjust practices but because the whole housebuilding industry had its reputation tarnished because of a few companies taking advantage of their customers.

Along with the leasehold reforms, we also welcome the idea of a Commonhold Council, as industry, local authorities and homeowners will need to understand how the change will work in practice.”

Shared by: Tony Billington of Builders.org.uk

EAN Breaking News

Breaking News from the team at Estate Agent Networking. Have a new story to share with us? Then please get in contact today! When and where we can we will refer to third party websites with a 'live link back' where news was released first.

You May Also Enjoy

Estate Agent Talk

Closing the gap on client relationships and recommendations

New research from iamproperty has highlighted the growing disconnect between what buyers and sellers want from their agent and what they experience, which could be killing recommendations from happy clients. iamproperty’s quarterly consumer survey revealed that only a third of respondents (32%)¹ would recommend their agent following their experience. With many agents relying on recommendations…
Read More
Estate Agent Talk

Northern Ireland to expect over 25,000 new home movers

Belfast-based estate agency John Minnis has revealed that Northern Ireland is to welcome an estimated 25,000- 30,000 new arrivals from the UK and Europe over the next five years, as migration to the region reaches its highest levels in more than a decade. Recent figures show that 11,700 people relocated from other parts of the…
Read More
Breaking News

Red tape and rising costs stifling new-build availability across the capital

The latest analysis from London estate agent, Benham and Reeves, has revealed how protracted building timelines are preventing the capital’s housebuilders from delivering the level of new-build housing stock required to meet demand, with new homes currently accounting for just 7.5% of all properties listed for sale across London. Benham and Reeves analysed the latest…
Read More
Estate Agent Talk

UK’s new wave of ‘second cities’ offers strongest yield growth for property investors

The latest research from West One Loans has found that whilst investors may continue to favour the nation’s key cities such as London, Birmingham, and Manchester, a new wave of ‘second cities’ is delivering the strongest growth in rental yields. These emerging markets are offering investors the chance to achieve attractive returns, driven by rising…
Read More
Estate Agent Talk

Decline in change of use further constricting housing supply

Jonathan Samuels, CEO of Octane Capital, believes that a decline in conversion projects could ultimately prevent the Government from hitting its ambitious housing delivery targets, as the firm’s latest analysis has revealed that the number of homes created through change of use has fallen sharply in the last five years. Octane Capital analysed official Government…
Read More
Rightmove logo
Breaking News

Annual price fall driven by south, which could be harder hit by rumoured property taxes

The average price of property coming to the market for sale rises by 0.4% (+£1,517) this month to £370,257. However, average new seller asking prices are now 0.1% below this time last year following several months of muted price growth The dip in annual prices is driven by London and the south, as the south…
Read More