Legislation around the reform of the leasehold market, including banning newly-built homes being sold on a leasehold basis, is to be included in next week’s King’s Speech.
Rachel MacLean MP, the housing minister, confirmed on X (formerly Twitter) that the legislation will be included in the speech at the state opening of Parliament on 7 November.
Her post stated: “Plans to phase out leasehold and restore true home ownership confirmed today as part of the King’s Speech. We will restore true home ownership to millions of people and end the reign of rip off freeholders and incompetent profiteering management companies.”
No further details have been outlined by the government, though MacLean did link to a story on The Times which stated that Michael Gove, the levelling up secretary, had reached a “compromise” with Prime Minister Rishi Sunak which will see the gradual phasing out of leasehold properties.
It suggested that the legislation will mean that all newly built homes must be sold as freehold, though new flats can still be leasehold, while a consultation will be held around the idea of capping ground rent at ‘peppercorn’ rates.
A difference of opinions
The announcement was criticised by Matthew Pennycook MP, shadow housing minister, who described it as “thin gruel”, noting that the government had pledged to axe leasehold for new houses four years ago.
Timothy Douglas, head of policy and campaigns at Propertymark, said that agents and leaseholders would be “relieved” to hear that plans were in place for further reform of the leasehold system.
He continued: “Enfranchisement must be made easier, loopholes in redress must be closed, ground rent restrictions must be extended, and the UK Government must ensure any legislation to abolish leasehold improves consumer confidence and is fit for purpose.”
