The leasehold system in the UK has been crying out for reform for years, and the Government has decided to tackle the issues through the medium of a new consultation paper called ‘Fixing our broken housing market’.
The chief target for the Government has been the use of leaseholds for the sale of new properties, which is seen as a way that developers can receive a passive income as well as their development profit. One of the solutions to this problem will be capping the ground rent per property at £10 per year for the whole of the term of the lease. Measures are also proposed to ensure that the maintenance payments for the upkeep of communal areas etc. are reasonable.
There are other changes designed to assist with a more fluid sales process for leasehold properties by subjecting the supply of information that has to be given to purchasers to tight time limits.
The consultation closed on 26 November 2018 and the changes are expected to be implemented within the next two years.
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