Labour and Liberal Democrats pledge to abolish leasehold while Conservatives look to tie up loose ends
This week we have seen the production of the parties’ manifestos in the run up to the general election on July 4th in this note Mark Chick takes a look at the position adopted by the major parties in relation to leasehold reform.
Labour and the Liberal Democrats have published their election manifestos, with both parties committing to abolish the leasehold system, while the Conservatives have promised to continue the process of leasehold reform with a ground rent cap and changes to forfeiture rights.
On Monday 10 June, the Liberal Democrats became the first party to publish its manifesto ahead of the General Election on 4 July 2024. The manifesto states that “Too many new houses are built as leasehold and leaseholders still face large bills, not least because of the building safety scandal.” Among the policy proposals on housing, the manifesto includes a commitment to “abolishing residential leaseholds and capping ground rents to a nominal fee, so that everyone has control over their property.”
The Conservative manifesto published on Tuesday 11 June is a logical continuation of the reform process already underway. The party commits to “complete the process of leasehold reform, to improve the lives of over four million leaseholders. We will cap ground rents at £250, reducing them to peppercorn over time.” The Conservatives would also address the misuse of forfeiture and make it easier to take up commonhold.
On Thursday 14 June, Labour published its manifesto, with a commitment to “bring the feudal leasehold system to an end” although an earlier pledge to do so within the first 100 days of taking office has been dropped. The party says it would enact the full package of Law Commission proposals on leasehold enfranchisement, right to manage and commonhold and “take further steps to ban new leasehold flats and ensure commonhold is the default tenure” as well as tackle ground rent charges and unfair maintenance costs.
All parties have committed to taking steps to improve building safety and address unsafe cladding. Labour has pledged to “review how to better protect leaseholders from costs and take steps to accelerate the pace of remediation across the country” and focus on ensuring those responsible for the building safety crisis pay to put it right.
Meanwhile, the Conservatives have said they will continue to provide “support for leaseholders affected by historic building safety problems by requiring the continuation of developer funded remediation programmes for mid- and high-rise buildings” and the Liberal Democrats have committed to “Remove dangerous cladding from all buildings, while ensuring that leaseholders do not have to pay a penny towards it.”
With many commentators predicting a Labour majority, thoughts may turn to the possibility (or impossibility?) of abolishing leasehold as a form of residential land tenure. There is also the considerable work that will need to be done to make commonhold fit for purpose. Whichever party is in Downing Street on 5th July 2024, the thorny issue of freeholders’ human rights and the financial impact on pension funds, will be policy considerations as well as the question of when (and how) to enact the various provisions of the Leasehold and Freehold Reform Act 2024 that are sitting on the statute books ‘ready to go.’
All of these will be important questions to be addressed in the weeks and months ahead.
Contact our Landlord & Tenant team
If you have a query concerning leasehold property, then please contact our expert Landlord & Tenant team by emailing leasehold@bishopandsewell.co.uk or call on +44(0)20 7631 4141.
The above is accurate as at 14 June 2024. The information above may be subject to change.
The content of this note should not be considered legal advice and each matter should be considered on a case-by-case basis.
