Leaseholders will be able to extend their lease by 990 years at zero ground rent under new government plans.
It says that 4.5 million leaseholders will benefit from these reforms and that an online calculator will be provided so people can work out how much it will cost to extend their leasehold beyond the traditional 50 years.
Alongside this, the reforms propose that all new retirement leasehold properties will have their ground rents reduced to zero.
The government also plans to bring in a Commonhold Council, which will consist of leasehold groups, industry and government with the aim of preparing the market for the commonhold model – something used in many other countries but has been limited to 20 builds since 2002 in the UK.
The commonhold model is something the Law Commission has been touting as an alternative to leasehold for some time.
Housing secretary Robert Jenrick says: “Across the country people are struggling to realise the dream of owning their own home but find the reality of being a leaseholder far too bureaucratic, burdensome and expensive.
“We want to reinforce the security that home ownership brings by changing forever the way we own homes and end some of the worst practices faced by homeowners.”
Law Commission commissioner to property law professor Nick Hopkins adds: “We are pleased to see government taking its first decisive step towards the implementation of the Law Commission’s recommendations to make enfranchisement cheaper and simpler.
“The creation of the Commonhold Council should help to reinvigorate commonhold, ensuring homeowners will be able to call their homes their own.”
Meanwhile, Conveyancing Association director of delivery Beth Rudolf says: “Without legislation the issues which currently blight leasehold properties and make owners of leasehold property regret they bought them, and the misbehaviour of lease administrators, will continue.
“The announcements by the government today are a fabulous first step towards resolving those issues and we look forward to hearing the ministry’s plans and timetable to introduce the required legislation.”
