KING’S SPEECH, NOVEMBER 2023 – LEASEHOLD AND FREEHOLD REFORM BILL
King Charles announced within his speech on the 7th November 2023 a new Leasehold and Freehold bill in an aide to support leaseholders. These reforms build on the Leasehold Reform (Ground Rents) Act 2022, which put an end to ground rents for new, qualifying long residential leasehold properties in England and Wales.
Some of the main key features proposed:
Extending the standard contract lease extension from 90 years to 990 years.
Removing the 2 year ownership requirement to be eligible to extend a lease.
Prevent housebuilders from selling new terraced, semi-detached and detached homes as leasehold.
Increase the non-residential limit where leaseholders can buy their freehold to 50 per cent.
It is uncertain when the Bill will pass into law but it will certainly improve the position for all leaseholders and will naturally cause less issues for conveyancers in respect of low lease terms (arranging deeds of variations and client lender issues). There is however the risk that Landlords may substantially increase the premium (marriage value) due in consideration for a longer lease term so we await to hear if the government impose further guidance on this.
The King added that the government would “deliver a long-term plan to regenerate towns and put local people in control of their future”.
Alex Wright, Licensed Conveyancer