Empowering leaseholders
In his address, King Charles III relayed the UK Government’s plans to reform the housing market with a Leasehold and Freehold Bill which will make it cheaper and easier for leaseholders to buy their freehold and tackle excessive service charges.
Leaseholds for new houses - but not new flats - in England and Wales will be outlawed and the standard lease extension period will be increased to 990 years. It is also planned to drop the requirement for someone to have lived in a property for two years before they can propose an extension.
Improvements will be made to leaseholders’ consumer rights and protections, including
- Setting a maximum time and fee for the provision of information required to make a sale to a leaseholder by their freeholder
- Requiring transparency over service charges
- Removing building insurance commissions for managing agents
- Extending redress schemes for leaseholders to challenge poor practice
- Building on measures in the Building Safety Act 2022 to ensure freeholders and developers can’t escape liability for remediation work
The wait could be over for Renters Reform
The existing Bill will deliver a long-promised ban on Section 21 evictions in England, but this will only come into force after reforms to the court system.
The UK Government says that work has started on this, with an initial commitment of £1.2 million to begin designing a new digital system for possessions. As work progresses, they have committed to engaging with landlords and tenants to ensure the new system supports an efficient and straightforward possession system for all parties.
The first sitting of the Public Bill Committee is expected to be on Tuesday 14 November where they will scrutinise it line by line and the Committee is scheduled to report by Tuesday 5 December. Timothy Douglas, Head of Policy and Campaigns will represent members and give oral evidence to MPs during the Committee Stage of the Renters (Reform) Bill next week.
Many agents and leaseholders will be relieved that plans have been set out in the King’s Speech for new legislation to further reform the leasehold system - this is long overdue.
It is welcome that the UK Government has recognised the importance of reforming the court system and protecting the rights of landlords to get their property back when things go wrong before significant changes to private renting in England are introduced.
We look forward to working with the UK Government to ensure both pieces of legislation are evidence-based and fit for purpose.
