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990-year lease extensions could help end leasehold scandal

The long-awaited proposals for leasehold reform produced by the Law Commission suggests giving owners the right to extend their lease for nearly 1,000 years while at the same time removing any obligation to pay rent to the freeholder.

The report, released yesterday after two years of deliberations, seeks to address recent scandals of new-build homes sold with leases including high fees with built-in ground rent increases, effectively preventing some owners from selling.

Proposals include giving owners the right to extend their leases by 990 years instead of the usual 50 or 90 in place now, and that there should be no continuous ground rent under this extended lease.


Other proposals would prevent landlords attaching new obligations to lease extensions, and increasing the potential of owners to buy out the ground rent without also having to extend the length of the lease.

The Law Commission’s report also recommends allowing leaseholders to extend their lease or buy their freehold immediately after purchasing a property rather than having to wait two years as they do now, as well as capping costs of extending leases.

“Our reforms will make a real difference by giving leaseholders greater control over their homes, offering a cheaper and easier route out of leasehold, and establishing commonhold as the preferred alternative system” explains Professor Nick Hopkins, one of the law commissioners.

A statement from the National Leasehold Campaign gave support to the proposals saying: “The NLC is delighted that the Law Commission’s reports recognise how badly the current leasehold system is stacked against leaseholders and is recommending adoption of commonhold, and informed and practical routes for existing leaseholders to escape from the nightmares created by this feudal system. 

“We need government to act on these recommendations now. They must not be lost in a sea of endless consultations, further consideration and drift ‘until Parliamentary time allows’. Leaseholders’ lives are on hold and urgent action is needed.”


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