The Leasehold and Freehold Reform Bill will be introduced in Parliament today.
This seeks to ban leaseholds on new houses while also making it easier for homeowners to extend their lease or buy the freehold.
This is the first step to the proposals contained within the bill appearing on the statute books in England and Wales.
The housing secretary Michael Gove said he remained confident that this bill, introduced in the King’s Speech, will pass into legislation before the next general election.
The bill has been broadly welcomed by campaigners although there have been criticisms that the measures in the bill only cover new-build houses, not flats.
There have been reports that some Conservative MPs will seek amend the bill to also abolish leaseholds for new flats. Labour has said it would back such moves.
Speaking to the BBC, Gove said he would look at any amendments. While Gove said he would like to see the “outdated” leasehold system scrapped altogether over time, he added this was a complex area of a law, and the measures contained in this bill were designed to pass through Parliament quickly to deliver additional protection to householders today.
Alongside the ban on leaseholds for new-build houses, the bill contains provision to increase the standard lease extension from 90 to 990 years. It also provides measures to ensure more transparency when it comes to services charges for existing leaseholders and to make it simpler and cheaper for leaseholders to take over the management of their property.
Gove said: “We want to make sure that we proceed in a way, in a complex area of law, that helps people now. I’m absolutely confident this bill will be on the statute book by the time of a general election. It has widespread support in the House of Commons and the House of Lords.”
The government is also consulting on options to cap ground rents for existing leases.
The Conveyancing Association welcomed the fact that this bill will look at leasehold reform — an issue it has been campaigning about for many years, along with other stakeholders.
The Conveyancing Association’s director of deliver Beth Rudolph says: “The CA is certainly relieved to see a great deal of the leasehold plans, recommended by the Law Commission Reports, present in this Leasehold and Freehold Bill, particularly as both the CA and many other market stakeholders have been campaigning for these reforms for many, many years.
“It is of course a real positive to finally hear they will be enacted into law, and leaseholders will get the protections they deserve, and will be treated fairly in many key areas such as leasehold extensions, service charges and their transparency, and fair hearing of their complaints.”
However she said that while the bill delivers across a large number of areas, there is still more work to be done, particularly around key areas such as ‘commonhold’. “The CA will continue to lobby for those changes which we believe add further fairness and transparency to the system.”
