Government plans to end the leasehold system have been dropped, according to the Guardian. Instead, the Levelling Up, Housing and Communities Secretary, Michael Gove, will announce a package of new measures to help leaseholders.
These are expected to include capping ground rents and powers to allow leaseholders to choose their own management company, as well as further protections for tenants from legal fees.
There are 10 million UK leaseholders, who own the right to occupy their property not the land it is built on. A large percentage of London flats are owned under the system. Leaseholders can face high costs to extend the length of time on their lease; for repairs and maintenance to common areas and if ground rents and service charges increase.
In January, Mr Gove pledged to end leasehold this year, describing it as “feudal” and “outdated”. He wanted to replace it with a commonhold system for flats. Commonhold, which is popular in other countries, involves flat owners making joint decisions about repairs and upkeep to communal areas.
It is believed that Mr Gove regarded move as a vote winner, especially among younger urban electors, however Downing Street thought it would be difficult to introduce before the 2024 election.
Last year, the government abolished ground rents for most new leasehold properties in England and Wales.
According to the Department for Levelling Up, Housing and Communities: “We have already made significant improvements to the market – ending ground rents for most new residential leases and announcing plans to make it easier and cheaper for leaseholders to extend their lease or buy their freehold.”
Read more about this story in the Guardian.