An industry supplier owned by the Leaders Romans Group says the government’s pledge to reform - not replace - leasehold should be warmly welcomed.
A new Bill to consider reform was one of 21 legislative measures announced in yesterday’s King’s Speech.
Rob Poole, director of Glide, says the idea of replacing leasehold with commonhold is unworkable because in large blocks any form of dispute resolution would be immensely complicated.
He says: “The Government has already done a lot to make things fairer for leaseholders, such as changes to ground rents and the work with insurance commissions. This new Bill provides an opportunity to build on that.
“Similarly estate charges should come into focus more as some cases have seen rises in over 140 per cent over the last four years.
“Homeowners have no mechanism to challenge estate charges in the way that leaseholders can challenge service charges at a Leasehold Valuation Tribunal. This runs the risk that estate charges could push homeowners into poverty in future years.”
The government has also suggested that it would extend the concept of the 99 year lease to 990 years.
Poole continues: “The proposed lease extension is also welcome, because short leases delay sales, cause chains to break down and consequently contribute to the housing crisis.
“While I welcome improvement, I’m conscious that change does not necessary constitute improvement – it is vital that the Government considers all potential changes very carefully and consults widely.”
There’s been a very different response from Jeremy Raj, Head of Residential Property at law firm Irwin Mitchell.
He says: “It’s difficult to imagine that anything of significance will be achieved following the announcement, other than further irritating certain MPs with unrealistic expectations, along with all the vested interest groups within the residential property sector.
“This includes those proclaiming the need to abolish a ‘feudal system’, those wanting certainty and a better way to structure new developments, those wanting significantly greater protections from abuse for leaseholders, and those wanting to protect and realise their investments.
“Last but not least, it also disappoints those of us who have been hoping for many years now for a co-ordinated and fundamental overhaul of the areas that have let leasehold down as a system of tenure, and who believe a better way (absolutely not commonhold) is well within our capabilities.”