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Major reform is on the way to the leasehold property market in England. The Government is to ensure that the majority of new-build properties are now sold as freehold while also capping ground rent at a nominal sum.
With around 4.2 million leasehold properties in England alone, the new measures will have a wide-ranging effect.
Communities Secretary James Brokenshire says the changes are intended to end the “unjustified selling” of new houses as leasehold.
The new measures will also work to make it faster, fairer and cheaper for leaseholders who want to buy their freehold.
Leaseholders pay on average more than £300 a year in ground rent with some paying up to £700. One proposal from the Government is to cap ground rent at £10 a year.
There will also be support for leaseholders who want to form a tenant association to enforce their rights under the law.
Announcing a consultation on the proposals, Mr Brokenshire said: “The government is committed to making the economy work for everyone by helping people with the cost of living.
“Unfair ground rents can turn a homeowner’s dream into a nightmare by hitting them in the back pocket and making their property harder to sell.
“That’s why I’m taking concrete action to protect homeowners and end those unscrupulous leasehold practices that can cost tenants hundreds of pounds.”
Fran is the content writer for Capital Conveyancing, producing articles on all aspects of the conveyancing process and around the UK property market in general. If there is a topic you'd like to see covered on these pages, please drop Fran a line on [email protected]