Property Lawyers have long anticipated changes to the law that will simplify the process Leaseholders must follow to extend their Leases and/or acquire the Freehold of their building.
The Housing Secretary, Robert Jenrick, has now announced the government’s plans to address the proposed reforms to residential Leaseholds. The main changes are as follows: –
- 990-year Lease Extensions with a zero-ground rent.
- An abolition of Marriage Value.
- Establishing a Commonhold Council, a partnership of Leasehold groups which will be responsible for addressing how this should work.
The government also plans to set up an online calculator to enable Leaseholders to ascertain the premium that they will have to pay to extend their Leases or acquire the Freehold of their building.
As to the abolition of Marriage Value; although this will, of course, result in Leaseholders paying substantially less to extend their Leases or acquire the Freehold of their building; the likelihood is that this will lead to strong objections by Freeholders.
At this stage, this is only proposed legislation and there is currently no set timetable to pass the legislation required to delivery the proposed changes. We simply do not know, as of yet, exactly when and how these changes will take place.
The Association of Leasehold Enfranchisement Practitioners has therefore asked the government for further clarity as to the timescale of any such changes and how such changes will actually work in practice. https://www.alep.org.uk/article/838/alep-welcomes-announcement-of-government-reforms-to-leasehold-sector-ndash-but-questions-what-change-will-look-like-in-practice
For Leaseholders with diminishing Leases it may still be prudent to proceed now rather than wait for the new legislation. We would therefore suggest that you contact us for further advice/ information: –