Tackling unfair practices in the leasehold market – Government consultation


The Government consultation on tackling unfair market practices in the leasehold sector has closed on 19th September 2017. This firm, among many others have submitted responses to the Government on the issues raised.

Much publicised issues concerning leasehold houses and ground rents together with parliamentary pressure which has been building for some time (particularly since the debate on the 20 December 2016) and the all-party parliamentary group on leasehold matters chaired by Sir Peter Bottomley, has led to the government commissioning this consultation to discuss current abuses within the system and what can be done about them.

It is interesting that Russell Hewitson, the Chair of the Law Society conveyancing and Land Law Committee commented in a recent article debating the pros and cons of the leasehold system and in particular the question of leasehold houses that it would be:

‘Short sighted for solicitors to dismiss this whole topic in that way, or to compile themselves to a legal minutiae around the edges. Our law is not an end in itself: it must properly serve our society. When a legal structure that we are so familiar with is generating such intense public concerning, we have an important part to play in the debate about the solutions.’

The Government consultation makes plain that a number of options are been considered including restrictions on rents that can be charged, the question of whether properties developed as houses should be sold as leaseholds.

There are a number of valid legal and technical reasons why leasehold structures may be appropriate in relation to shared property, but it is clear the government clearly has determined to investigate and find out what can be done to prevent abuses of the existing system.

As experts in the leasehold area, we have contributed to the consultation both individually and collectively and through our involvement in bodies such as ALEP.

Mark Chick, head of the Landlord and Tenant Team at Bishop and Sewell commented as follows:

‘It is encouraging to see that government has decided to look at this area which has been the subject of debate on the question of reform over a number of years. It is also clear that given the level of publicity that this area has received recently, the government is determined to investigate what can be done to protect the end users of leasehold property. Whilst the headline cases show the far end of the scale as unacceptable practices go, the area itself is highly technical and any change must be appropriately managed. There are a number of good reasons to have leasehold structure, where there are shared services or buildings but the terms of these documents must always be looked at closely.

There appears to have been a failure in the reported cases in so far as access to quality independent advice is concerned and it is precisely because some of the more technical points in the area have not been more widely understood that the current situation has developed.’

If you have a query concerning leasehold property then please contact our expert team by emailing leasehold@bishopandsewell.co.uk.


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