The “feudal” tenancy system in England and Wales will be overhauled by the end of the current parliament, the government has announced, as campaigners raise concerns over delays.
Millions of tenants currently own the right to use their property for a period of time and can pay hundreds of annual ground rents to a landowner – in addition to a separate service charge.
Announcing a new reform timetable, Housing Minister Matthew Pennycook said shared ownership – where people own their home without their lease expiring – will become the default tenure ahead of the next election.
Campaigners have warned it could be too late to help current tenants trapped in exploitative agreements.
Katie Kendrick, founder of the National Leasehold Campaign (NLC), said that while she was “happy” the government was keeping its promise to scrap leaseholds, it might not be fast enough for everyone.
“Our main concern now is the plight of existing tenants who are currently suffering at the mercy of unregulated managing agents and unscrupulous landowners,” she said.
“The government's stated intention to 'act as quickly as possible' will not be fast enough and we are already seeing the desperation of some NLC members who are facing bankruptcy due to escalating service charges.”
Outlining a specific timetable for leasehold reform for the first time, Mr Pennycook said elements of the Leasehold and Freehold Reform Bill, passed by the Conservative Government earlier this year, would be implemented. artwork.
From January, the “two-year rule” preventing tenants from extending their lease or purchasing their property for the first 24 months will be removed. From the spring of next year, the government wants more tenants of mixed-use buildings to be able to take over management. their landowners, and will no longer have to pay their landowners' costs if they file a claim against them. By the second half of next year, the government will set out how it will ban new leases, following a consultation
Ministers will also consult on how tenants can more easily challenge unreasonable service charges and require landlords to obtain court approval before passing on their legal costs to tenants.
As for current leasehold properties, Mr Pennycook said: “We will also engage in converting existing apartments into shared ownership. »
Not all elements of the 2024 Bill will be implemented, however, as ministers say they have identified flaws “which would prevent certain provisions from working as intended and which need to be rectified”.
There are around five million leasehold properties in England and Wales, with some landlords claiming to have faced unjustified ground rents or service charges and problems carrying out repairs.
Mr Pennycook said: “With millions of tenants and residential property owners currently suffering from unfair and unconscionable practices, we fully understand the need to act urgently to provide relief. »
Natalie Chambers, director of the freehold residential association, said her organization wanted to work with the government “to implement meaningful and achievable reforms”.
“We welcome the Government’s recognition of the complexities involved in implementing tenancy reform, as well as the serious shortcomings of the legislative approach taken by the previous Government,” she said.
In April, Labor backed away from introducing legislation abolishing tenancy within its first 100 days of coming to power.
The changes concern England, but the Westminster government says it will work closely with the Welsh government to implement reforms there.
Scotland has no leasehold properties, while Northern Ireland has only a handful of leasehold properties.
The government's announcement was made after the BBC requested an interview for a day of special coverage on Friday, November 22, looking at the scale and impact of rental issues.
