Bishop & Sewell

I sit at my desk, cup of tea in hand. It is 9.30 (ish) on the morning of Friday 13 December 2019; the last Friday the 13th of this decade, following the last full moon of this decade, and the question is posed to me – what does 2020 hold in store?

As I stare into my teacup, I reflect on the election fever which has swept over this nation as years of uncertainty, unrest and angst finally bubbled to the surface.

As a litigator, conflict is my business, but the obsessive bickering which has suffocated our Government, causing it to move at the pace of a weeping angel under constant surveillance, has been insufferable. However, and following what can only be regarded as a dramatic election result, I join the electorate in waiting with bated breath to see what Mr Johnson will actually do with his majority.

The Conservative Manifesto is rather vague as to actual proposals on leasehold reform, save that they “will continue with [their] reforms to leasehold including implementing [their] ban on the sale of new leasehold homes, restricting ground rents to a peppercorn, and providing necessary mechanisms of redress for tenants.”

Members of the public who have followed the development of these ‘leasehold reforms’ may be pleased to note that Eddie Hughes – the introducer for the Ground Rents (Leasehold Properties) Bill – has retained his seat. The continuation of Mr Hughes, an enthusiastic proponent for reform in this area, may allow respite to leaseholders’ concerns that the absence of reference to leasehold reform in the preceding Queen’s Speech could have meant this Bill would risk being resigned to the annals of history.


The Government’s manifesto also touches upon untangling the current Shared Ownership policies, and increasing the reach of the Right to Buy pilot which was tested in the Midlands – it will be interesting to see how these policies work symbiotically with the proposed leasehold reform policies, although it is unlikely that these policies and schemes will emerge from their infancy much before I sit drinking a cup of tea following the last full moon of 2020!

There had been criticism that the Government spotlight focused too significantly on newly granted leaseholds, rather than existing ones. If this does transpire to be the case, will there be a sudden surge of surrender and re-grants, earlier than convention would normally dictate, to navigate a route into these protections to retain desirability when compared to their young counterparts?

Will any decrease in ground rent income lead to a ready willingness on the part of freeholders to divest themselves of their interests? The Manifesto “commit[s] to implementing and legislating for all the recommendations of the Hackitt Reviewfollowing on from the Grenfell tragedy. There comes with this the question of who will shoulder the costs of these improvements?

Although the pound saw a rally in the wake of the exit poll, this does not provide any certainty that the leasehold market will not remain impacted by other policies which the Government have suggested. This includes the levy on stamp duty for non-UK resident buyers investing in property (to support public policy initiatives such as providing a greater level of affordable housing and schemes surrounding the Homelessness Reduction Act), or the “Better Deal for Renters scheme abolishing ‘no fault’ evictions”.  Until there is clear detail on the specifics of this new Government’s actual intentions, investors may remain circumspect toward investment in leasehold properties.

The issues considered in the May 2018 Briefing Paper on the Regulation of Letting and Managing Agents remain an overarching concern for agents, landlords and tenants alike, with recommendations as to appropriate qualifications becoming a pre-requisite appearing in July 2019.

There also remains the failed experiment of commonhold to address, and in the absence of such solution meaning joint leasehold-freeholders are left with the unsatisfactory option of individuals being required to navigate the Companies Act 2006 with the risk that the company may be dissolved and the freehold passing Bona Vacantia.

The Conservative Manifesto focuses on improving community, implying that the satisfaction of residential home life is at the very heart of this Government’s ethos. Society has reached a new enthusiasm for scrutinising the Government and ensuring they are held to account. If the Government honours its promises, this may herald in a golden era of reform for leaseholders however, if they don’t, there will be limited places for them to hide this time.

So, and in summary, I do not foresee 2020 in the tea leaves as being the year when the world of leaseholds is shaken up, but it should be the year of emergence of policy in readiness for 2021.

Leaseholders will want to retain a ready eye on the proposals emerging from this Government and in particular taking advantage of any options to improve on the value of their leasehold interests, and be aware as to any local devolution which is suggested will see benefits across the UK. Conversely, freeholders, buy to let landlords, and agents will wait with trepidation as to the further obligations, duties and costs which they may become subject to – although the Manifesto does suggest that “… if you are one of the good landlords, [they] will strengthen your rights of possession.” so the buy-to-let market may not be doomed yet.

As for me, I shall enjoy scathing arguments returning to the art of actual debate, and continue with my cups of tea whilst considering if that shade of green on the front door really does constitute a breach of the lease.

Wishing you all a Merry Christmas and a Happy New Year,

Charles Jamieson is a Legal Executive in the Litigation & Dispute Resolution team at Bishop & Sewell LLP specialising in property and commercial disputes.

Email or telephone 020 7631 4141 for more information.

Category: Blog | Date: 13th Dec 2019

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