Leasehold flats ban beginning of the end for ‘feudal' system, minister says
New leasehold flats are set to be banned under Government plans to make commonhold the default tenure, with homeowners expected to have greater control over their properties.
Housing minister Matthew Pennycook said the reforms 'mark the beginning of the end' for the 'feudal' leasehold system, which subjects homeowners to 'unfair practices and unreasonable costs'.
Under the current system, third-party landlords can own a building's lease and therefore make decisions on behalf of homeowners.
The Government has proposed to bring the leaseholds system to an end, in line with its manifesto commitment, and give homeowners more control over how their buildings are run.
Homeowners will not have to pay extra costs such as ground rent under the proposed reforms.
A Commonhold White Paper published on Monday states commonhold will be 'reinvigorated' through a new legal framework and the sale of new leasehold flats will be prohibited.
Mr Pennycook said: 'This Government promised not only to provide immediate relief to leaseholders suffering now but to do what is necessary to bring the feudal leasehold system to an end – and that is precisely what we are doing.
'By taking decisive steps to reinvigorate commonhold and make it the default tenure, we will ensure that it is homeowners, not third-party landlords, who will own the buildings they live in and have a greater say in how their home is managed and the bills they pay.
'These reforms mark the beginning of the end for a system that has seen millions of homeowners subject to unfair practices and unreasonable costs at the hands of their landlords, and build on our Plan for Change commitments to drive up living standards and create a housing system fit for the twenty-first century.'
The Government has also said it is 'determined' to make conversion to commonhold easier for existing leaseholders.
A draft Leasehold and Commonhold Reform Bill, which will include the detail of how reformed commonhold will work, will be published later this year, the Ministry of Housing, Communities and Local Government has said.
Legislation will apply to England and Wales, where there are around five million leasehold homes.
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