Government's Leasehold Reforms Fall Short, Campaigners Say
The government is consulting on a ban of new leasehold house sales and capping ground rents for existing leases. However, campaigners are dissatisfied as the reforms don't abolish the leasehold system for current leaseholders and some amendments were rejected.
The Leasehold and Freehold Reform Act aims to tackle issues faced by leaseholders, such as high service charges and lease extension barriers. It introduces a redress scheme for challenging service charge costs and standardized billing formats.
The reforms aim to reduce delays in selling leasehold properties by setting maximum time and fees for freeholders and managing agents. Leaseholders will no longer need to have owned their property for two years before extending their lease or buying their freehold.
Further reforms are expected to simplify the process for tenants with leases over 80 years to extend their leases at a lower cost and potentially reduce associated ground rent expenses. The Act promises to boost leaseholders' rights to acquire freeholds, extend leases, and collectively manage buildings.
While the reforms address several issues, homeowners and campaigners still face challenges with leasehold properties, making remortgaging or selling difficult. Additional legislation is expected to fill gaps, with some changes not taking effect until 2026.
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