Ban leasehold houses and new ground rents, MPs urge government

The All Party Parliamentary Group on Leasehold and Commonhold Reform has made a hard-hitting submission to formal government consultations on the future of the leasehold system.

Over the weekend the APPG released its response which urges an end to leasehold houses and the scrapping of new ground rents. Instead it wants to introduce the little-known commonhold system and a ban on new leasehold tenancies. 

“Action is needed urgently, so that millions of leaseholders can be given greater protection and security and be treated more fairly within a sector which is presently open to abuse despite the systems that exist under current legislation” says the submission.

“The APPG’s interim report [already published] found there seems little direct evidence that offering leasehold houses results in lower costs to home buyers. No developer has been willing, nor do we think able to provide specific evidence that ground rent income streams are needed to make a development viable.”

Amongst those quoted by the MPs are Jolyon Harrison, chief executive of Gleeson Homes, and Bob Bessell, founder of niche builder Retirement Security, saying leasehold homes and ground rents are not appropriate today. 

“The APPG is aware that providers in the sector are likely to come forward with some form of self-regulating code of conduct. There is no evidence historically that self-regulation has been effective. There is evidence the sector may have already begun to move on from generating ground rent income streams. We are now seeing an increase in onerous covenants in freehold titles that seek to reflect many of the charges that had recently been imposed on leasehold houses” continues the submission.

You can see the entire submission here.

The All-Party Parliamentary Group made special mention of the work of the charity Leasehold Knowledge Partnership and its trustees, and those who supported the work of the committee.