Parliamentary news may have been dominated by the fallout from the Rwanda Bill yesterday but another important piece of legislation also returned to the commons – the Leasehold and Freehold Reform Bill.
The Leasehold and Freehold Reform Bill aims to make it cheaper and easier for existing leaseholders in houses and flatsto extend their lease or buy their freehold.
It is also hoped that reforms will make these types of properties easier to sell.
The legislation has reached committee stage this week.
It already heard from the Leasehold Knowledge Partnership and the National Leasehold Campaign yesterday and other property groups are scheduled to put forward their views later this week.
The Labour Party has also put forward amendments, with several put forward by Shadow Housing Minister Matthew Pennycock, including ensuring that new flats have a residents management company in place to let leaseholders takeover management of the block.
He said: “Labour will seek to strengthen this unambitious piece of legislation to further advantage leaseholders.
“But it will fall to a Labour government to fundamentally and comprehensively overhaul the current system.”
There were also concerns that the initial legislation omitted a previously-promised ban on leasehold sales of houses, but it is hoped this will be introduced at committee stage as well.
Meanwhile, a related consultation on reforming ground rents closes today and concerned parties such as agents are being urged to respond.
The Government is seeking views on:
- Setting ground rents at a peppercorn
- Putting in place a maximum financial value which ground rents could never exceed;
- Capping ground rents at a percentage of the property value;
- Limiting ground rent in existing leases to the original amount when the lease was granted; and
- Freezing ground rent at current levels.
It comes as a survey of members of the Association of Leasehold Enfranchisement Practitioners this week found 80% believe residential ground rents can have a negative or undesirable impact on the sale of leasehold properties.
Members highlighted that often the property cannot be sold because mortgage providers do not like the ground rent terms, while 43.2% highlighted that the full terms related to ground rent payments are not initially made clear when buying the property.