Ministers' embarrassment as bill to ban leaseholds doesn’t actually ban leaseholds

29 November 2023, 17:28

The new Bill does not include its focal reform. Picture: LBC

By Georgina Greer

The so-called Leasehold and Freehold Reform Bill was included as one of the key measures in the King’s Speech this month, but its focal reform is not actually included in it.

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The Department for Levelling Up has not had time to draft the centrepiece reform that would have banned the sale of new leasehold houses before the legislation is presented to parliament, it has admitted to The Times.

They now face having to make an amendment to their own bill in order to introduce the measure, or pulling the legislation altogether and introducing a new, rectified version.

Initially, ministers said that the bill would, for the first time, ban developers from selling new leasehold houses apart from in exceptional circumstances as the first step towards phasing out leasehold altogether.

Matthew Pennycook, the shadow housing minister, who spotted the omission, said: “Not only does this long overdue piece of legislation not ensure that new flats will be sold as freehold, contrary to what ministers have claimed it doesn’t even do what it says on the tin and ban the sale of new leasehold houses.“

He continued: "A Labour government will make commonhold the default tenure for all new properties as part of our commitment to fundamentally and comprehensively reform the leasehold system by enacting the Law Commission’s recommendations on enfranchisement, commonhold and right to manage in full".

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Levelling Up minister Micheal Gove previously branded the leasehold system as "feudal" and hailed the Bill has a "landmark for millions of people".

Officials behind the scenes have admitted the Bill was drafted "in a huge hurry" as Number 10 delayed the decision to include it in the King's speech at all.

As a result, the section of the bill banning new leasehold was not ready in time for its first reading, which took place earlier this week.

The department now hopes to have the messages ready as an amendment to the legislation for early next year.

A representative for the Department for Levelling Up, Housing and Communities said: “Liberating leaseholders forms a vital part of the government’s long-term plan for housing.

“That’s why we are bringing forward the biggest changes to the system for a generation by giving leaseholders significant new rights, powers and protections through the Leasehold and Freehold Reform Bill.

“As we laid out on Monday, we will bring forward amendments as the bill progresses through parliament and that includes the ban on leasehold houses.”

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