New Bill to protect homeowners and end ‘feudal system of leasehold’

The UK government has announced a transformative new bill aimed at abolishing the ‘feudal system of leasehold’ and offering homeowners enhanced protection and a fairer deal.

Elizabeth Crouch Senior Associate Solicitor & Head of Residential Property provides an update.

Leasehold and Commonhold Reform Bill Unveiled

As revealed in the King’s Speech, these significant changes will be introduced through the Leasehold and Commonhold Reform Bill.

The government’s guidance notes outline several key measures to overhaul the leasehold system and promote commonhold ownership.

Key Reforms in the Bill:

1. Enhancing Leaseholders’ Rights
   • The government will enact the remaining Law Commission recommendations to strengthen leaseholders’ fundamental rights. This includes extending their lease, purchasing their freehold (enfranchisement), and assuming control over building management functions (Right to Manage).
2. Modernising Commonhold
   • Efforts to reinvigorate commonhold will involve modernising the legal framework. The government also plans to restrict the sale of new leasehold flats, ensuring future generations can enjoy absolute homeownership. A public consultation will be held to determine the most effective approach.
3. Regulating Ground Rents
   • To tackle existing ground rents, the government will introduce regulations preventing unregulated and unaffordable costs for current leaseholders.
4. Ending ‘Fleecehold’ Practices
   • The bill aims to eliminate the injustice of ‘fleecehold’ on private estates. A consultation will explore the best methods to implement new protections for homeowners, which will be included in the Leasehold and Freehold Reform Act 2024.
5. Protecting Against Forfeiture
   • The government will end the practice of forfeiture, ensuring leaseholders are not at risk of losing their homes due to small unpaid debts.
6. Implementing Broader Reforms
   • The Leasehold and Freehold Reform Act 2024 will bring comprehensive rights, power, and protections for leaseholders, ensuring a fairer system overall.

We will continue to keep you updated on these developments.

If you would like advice about the legal aspects of buying or selling a home please contact Elizabeth on 01697 72378 or click here to send her an email.