A law to reform the leasehold system in England and Wales is expected to be successfully passed by the upcoming general election, according to Housing Secretary Michael Gove.
Later today, Parliament is scheduled to hear the measure, which would prohibit leaseholds for newly constructed houses but not apartments.
A freehold purchase or lease extension would also be simplified and reduced in cost for homeowners. Existing regulations frequently require lessees to pay ground rent and exorbitant maintenance fees.
As they only own the lease, which grants them access to the property but not the land on which it is constructed, this is the case.
Mr. Gove stated that the long-awaited legislation would enable lessees to "reclaim control of their property" and guarantee "reasonable" and transparent service charges and ground rents.
Protesters have generally endorsed the plans; however, certain individuals are dismayed that the prohibition on the sale of new leaseholds does not extend to apartments.
70% of the approximately five million leasehold residences in England are apartments. Mr. Gove, who had previously expressed his desire to completely eliminate the "outdated" system, asserted he remained dedicated to this objective.
In response to a question regarding the bill's potential enactment before the 2024 general election, Mr. Gove stated, "I am fully confident that this measure will be officially registered with the legislature before the 2024 general election." It has the support of the majority of both the House of Commons and the House of Lords.
Reportedly, some Conservative members of parliament may attempt to amend the measure to eliminate leaseholds on newly constructed apartments in addition to houses. Labour has expressed its intention to support such initiatives.
Mr. Gove stated that they will evaluate each proposed amendment as it emerges. The law, according to the government, would extend the standard lease term from 90 to 990 years.
At present, the process of purchasing the freehold or extending a lease is frequently complicated and costly, frequently amounting to thousands of pounds, legal fees included. Additionally, the government is conducting consultations regarding potential options to restrict ground rents for existing leases.
In addition to their mortgage, owners of leasehold properties pay a ground rent, which can be substantial and subject to unforeseen increases. This can pose challenges for the sale of the properties.
The National Leasehold Campaign's creator, Katie Kendrick, described the bill's introduction to Parliament as "momentous" and "long overdue."
Three years ago, Ms. Kendrick acquired the freehold of her leasehold home in Ellesmere Port, Cheshire, for approximately £8,000, legal fees included. However, she reported that a number of her estate's neighbours with more costly ground rents were unable to do the same and were currently having difficulty selling their properties.
She stated that the legislation would "give leaseholders some hope that there is a path out of this... because many leaseholders are currently trapped."
Ms. Kendrick, a Labour councillor in Cheshire, stated that it was critical the measure was passed "immediately" because all parties had failed to address leasehold issues for decades.
Prior to this, Labour advocated for commonhold to be the prevailing tenure for all newly developed properties, "while the system is entirely reformed to enable existing leaseholders to purchase collectively with greater ease and transition to commonhold should they so choose."