On 18th March the House of Commons Committee on Leasehold Reform published its report. The report draws together various themes concerning long leasehold and touches on a number of the issues raised as a result of the so-called ‘leasehold scandal.’ It also draws together some more overarching themes and whilst separate from the Law Commission’s current consultations on Enfranchisement, Commonhold and the Right to Manage, shows the willingness of government to look at these points together. There is also reference to the MHCLG’s call for evidence on ground rents.
Further details can be found at: https://www.parliament.uk/business/committees/committees-a-z/commons-select/housing-communities-and-local-government-committee/inquiries/parliament-2017/leasehold-reform-17-19/
Mark Chick of our leasehold team commented as follows:
“I welcome the report and findings of the select committee published on 18 March 2019. The Committee’s joined up approach to a number of the issues affecting the leasehold market shows the level of parliamentary support for an ‘agenda for reform’ in this sector.
Further clarity around the sales of new build leasehold properties would be very welcome and the issues that have arisen from the sale of houses as leasehold, particularly in the North West, have caused significant and well-reported issues. Clearly, having access to independent and accurate advice is key when dealing with leasehold properties and it does appear that in these cases, there has been an ‘advice failure.’ This is ultimately an issue for the professionals involved and the conveyancing market. It unfortunately shows that the ‘race to the bottom’ in terms of fees particularly when it comes to conveyancing services can have unfortunate and lasting consequences. Property is a significant, illiquid and long-term investment. The advice provided around its purchase needs to reflect that.
As a practitioner and as a practice, we welcome the government and the Law Commission’s commitment to review the law in this area and to look at other options including Commonhold. My view is that government can set an agenda for change here, not just by looking at the reform of the law in this area, but also by looking to the lending market and tax policy when considering the direction of travel that it wants to see.”
For more information, please contact our expert Landlord & Tenant team on leasehold@bishopandsewell.co.uk or call 020 7631 4141.
