In a significant move for homeowners, the Government has announced sweeping reforms that will cap ground rents at £250 per year for leaseholders across England and Wales. This landmark change is part of a broader package aimed at empowering property owners and addressing long-standing concerns in the housing market.
Major Leasehold Reforms Unveiled
The reforms, which represent one of the most substantial overhauls of leasehold law in decades, include a ban on new leasehold flats. This measure is designed to prevent future homeowners from entering into what many have criticised as unfair leasehold agreements. Additionally, existing leaseholders will be granted the right to switch to commonhold, a system that gives residents greater control over their properties and shared spaces.
Prime Minister's Announcement on TikTok
Prime Minister Sir Keir Starmer made the announcement in a video posted on the social media platform TikTok, highlighting the Government's commitment to modern communication channels. In his statement, Sir Keir emphasised the personal impact of the reforms, saying, 'I've spoken to so many people who say this will make a difference to them worth hundreds of pounds.' He added, 'That's really important because the cost of living is the single most important thing across the country.'
Key Provisions of the Draft Bill
The reforms will be formalised in the draft Leasehold and Commonhold Reform Bill, which is scheduled for introduction on Tuesday. Key provisions include:
- A statutory cap on ground rents at £250 annually, providing financial relief for leaseholders.
- A prohibition on the creation of new leasehold flats, shifting the market towards freehold and commonhold models.
- Enhanced rights for existing leaseholders to convert to commonhold, promoting greater autonomy and reduced management fees.
These changes are expected to benefit millions of homeowners by reducing ongoing costs and increasing property control. The Government's focus on leasehold reform reflects broader efforts to tackle housing affordability and improve consumer rights in the property sector.
