Leasehold and Freehold Reform Bill becomes law

The Leasehold and Freehold Reform Bill, the last legislation passed before Parliament adjourned ahead of the General Election on July 4, represents a partial victory for leaseholders. The bill introduces greater transparency regarding charges and bans the sale of new leasehold houses. However, significant anticipated reforms, such as a cap on existing ground rents and agency regulations, were not included due to time constraints.

Katie Kendrick, founder of the National Leasehold Campaign, expressed disappointment over the government’s failure to implement a ground rent cap, a measure they had repeatedly promised. Her sentiments were echoed by co-founder Cath Williams, who noted that while the bill brings positive changes like the removal of marriage value—potentially saving leaseholders with less than 80 years on their lease thousands of pounds in extension fees—the absence of a ground rent cap remains a significant missed opportunity.

Linz Darlington, managing director of Homehold, characterized the bill as a “muted win” for leaseholders. He emphasized that while the bill offers some benefits, such as abolishing marriage value and banning leasehold houses, it lacks crucial provisions like the removal or capping of ground rents and the prevention of forfeiture for small debts. Moreover, the implementation of these changes is not immediate or clearly defined.

Timothy Douglas, head of policy and campaigns at Propertymark, acknowledged that although the legislation is a step towards modernizing outdated laws, it falls short of addressing several key issues. He highlighted the need for further reforms, including the regulation of property agents, which was not incorporated despite its potential benefits for consumer protection in an increasingly complex regulatory environment.

Overall, while the Leasehold and Freehold Reform Bill introduces some beneficial changes for leaseholders, it is seen as an incomplete solution that requires additional secondary legislation and further reforms to fully address the challenges faced by leaseholders.

The Government announcement can be seen here – https://www.gov.uk/government/news/leasehold-reforms-become-law

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