Leasehold Reform – it’s a date!
In his statement today, Matthew Pennycook, Minister of State for Housing and Planning, finally shed some light on the steps that the government intend to take to implement reforms to the leasehold system.
Pennycook confirmed that, over the course of this Parliament, Labour are determined to honour the commitments made in their manifesto, and “do what is necessary to finally bring the feudal leasehold system to an end”.
Pennycook acknowledged the need to act urgently, but was careful to emphasise the need for speed to be balanced with care, to ensure that all measures brought into force are fit for purpose.
Proposed timetable
| LAFRA – ENFRANCHISEMENT / RIGHT TO MANAGE | |
| Removal of the two year qualification rule for freehold acquisitions and lease extensions | January 2025 |
| Right to Manage reforms in LAFRA (expanding access, reforming its costs and voting rights) | Spring 2025 |
| Consultation on capitalisation rate and deferment rate | Summer 2025 |
| Primary legislation (amending errors in LAFRA) and secondary legislation to commence LAFRA (including rates) | After summer 2025 consultation (but no commitment to a date) |
| LAFRA – RESIDENTIAL PROPERTY | |
| Consultation on detail of LAFRA’s ban on buildings insurance commissions | “Very shortly” |
| Consultation on estate charges | Summer 2025 |
| LAFRA’s provisions on service charges and landlord’s costs of service charge proceedings | 2025 |
| Consultation on reforms to section 20 ‘major works’ process | No date |
| Consultation on regulation of managing agents | 2025 |
| Consultation on private estate management arrangements | 2025 |
| COMMONHOLD | |
| White paper on commonhold | Early 2025 |
| Consultation on banning leasehold flats | 2025 |
| Draft Leasehold and Commonhold Reform Bill published (including banning ground rent and forfeiture) | Second half of 2025 |
Leasehold and Freehold Reform Act 2024 (“LAFRA”)
The first step is for a small number of specific but serious flaws in LAFRA, as well as some omissions, to be rectified via primary legislation.
Thereafter, an extensive programme of detailed secondary legislation will be required.
Only then, will LAFRA be ready to be fully “switched on”.
Further reform
In addition to the government’s plans to amend LAFRA, Pennycook confirmed an intention to address the Law Commission recommendations omitted from LAFRA. As mentioned in the King’s Speech, this will take the form of a new draft Leasehold and Commonhold Reform Bill, to be published in the second half of next year.
The Bill will consider a number of reforms to the existing leasehold system but its main focus will be to reinvigorate commonhold, with a view to making it the default tenure by the end of the Parliament.
Subcribe to news and viewsI am today updating the House on the steps the government intends to take to implement those reforms to the leasehold system already in statute and to progress the wider set of reforms necessary to end the feudal leasehold system for good.
https://questions-statements.parliament.uk/written-statements/detail/2024-11-21/hcws244
