Homeowners have gained more rights, power and protections over their homes.
Under the Leasehold and Freehold Reform Act, which was one of the final pieces of legislation to be rushed through before Parliament was prorogued, it will be easier and cheaper for leaseholders to buy their freehold.
It will also make it cheaper and easier for people to extend their lease and take over the management of their building.
However, plans to remove the ground rent for existing leaseholders or cap it at £250 were dropped. For many homeowners this was an opportunity missed as some are trapped by ground rents which increase every year and service charges which have become unaffordable. It has led some to consider selling up but who are frightened to do so give the terms of their contracts which may make it difficult to find a buyer.
Other elements of the act which did get through include the standard lease extension terms increasing to 990 years for houses and flats, a greater transparency over service charges and leaseholders will be able to “challenge landlords’ unreasonable charges” at tribunal.
The sale of new leasehold houses is now banned so every new home in England and Wales will automatically be freehold. Excessive buildings insurance commissions for freeholders and managing agents will end and the requirement for a new leaseholder to have owned their house or flat for two years before they can buy or extend their lease has been scrapped.
The new powers also grant freehold homeowners on private and mixed tenure estates the same rights of redress as leaseholders, and equivalent rights to transparency over their estate charges and help more leaseholders take over the management of their property if they want to.
Sheldon Bosley Knight’s director of residential sales, James Morton said: “There is a lot to celebrate with greater transparency over service charges and making it easier for leaseholders to buy their freehold.
“However the commitment to remove ground rent for existing leaseholders is a missed opportunity.”
