The Labour government has announced plans to reform the leasehold system, which has been criticized for leaving leaseholders powerless and burdened with rising costs, especially during the building safety crisis post-Grenfell. The new government aims to abolish the feudal leasehold system and make commonhold the default tenure for new properties. Commonhold allows homeowners to own the freehold of their homes and have more control over the management of the building.
Additionally, the government plans to regulate ground rents for existing leaseholders and protect them against losing their homes due to small unpaid debts. The proposed reforms aim to streamline the enfranchisement process, making it easier for leaseholders to extend their leases or buy their freeholds. The government also intends to reform the ‘Right to Manage’ to empower leaseholders to take over the management of their buildings.
Leaseholders have been facing unaffordable ground rents, rising service charges, and unaccountable management companies, leading to financial stress and mental health issues. The government’s commitment to ending the injustice of forfeiture and protecting leaseholders from losing their homes due to unpaid debts is seen as a positive step towards addressing these issues.
However, the government’s plans do not address the issue of building safety, which remains a significant concern for leaseholders across the country. Despite promises to improve building safety and protect leaseholders from costs, urgent action is needed to address remediation works in buildings with fire safety issues.
Campaign groups are calling for more concrete plans from the government to address the building safety crisis and protect leaseholders from financial burdens. While the proposed reforms are a step in the right direction, more comprehensive action is needed to ensure the well-being and security of leaseholders in the UK. The government must prioritize the safety and financial stability of leaseholders to create a fair and transparent housing system that benefits homeowners across the country.
