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Government responds to consultation on implementing leasehold reforms

2 July 2019

The government has set out what it intends to do following its consultation on introducing reforms to the leasehold system in England.

This consultation looked at how a number of measures to tackle unfair practices in the leasehold market should work in practice.

The government has committed to “promoting fairness and transparency for leaseholders and freeholders and ensuring that consumers are protected from abuse and poor service”.

It was announced in the response that:

  • all new-build houses will be sold as freehold in future in order to tackle unfair leasehold practices (as was already the government’s stated aim)
  • all new houses will be sold on a freehold basis except in exceptional circumstances
  • ground rents on new leases will be reduced to £0
  • a new time limit of 15 working days to provide leasehold information to a prospective buyer – the government will bring forward legislation to make this a statutory requirement
  • a maximum fee of £200 + VAT for freeholders and managing agents to produce leasehold information to prospective buyers in the form of a leasehold property enquiry (LPE1) pack
  • the secretary of state has also instructed Homes England to renegotiate to explicitly rule out the selling of new leasehold houses, other than in exceptional circumstances
  • buyers who were “incorrectly” sold a leasehold home will be able to acquire the freehold outright at no extra cost.

We largely welcome these announcements.

We are supportive of the time limit and capped fees for the provision of key sales information, which we hope will form part of improving the home buying and selling process.

We look forward to seeing the draft legislation and will continue to work with government on this important area of work.

Read the government’s full response

Read our response to the government’s consultation

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