Whilst it is encouraging that the Leasehold Reform Bill has become law, albeit by the skin of its teeth, it remains to be seen whether it will genuinely make a significant difference to the vast majority of people who own leasehold properties – namely those in flats and apartments.
Currently just 1% of new build houses are sold as leasehold in comparison to the overwhelming majority of flats and apartments. These reforms do not apply to the latter. The owners of flats and apartments often face significant expense and lengthy delays when trying to extend their lease or buy the freehold.
The legislation appears to have been pushed through in a much watered down form from the original draft, the proposed cap on ground rents of £250 for existing leases having been dropped. This can make selling leasehold properties with existing high ground rents a real challenge with many lenders having very specific requirements as to acceptable ground rent levels.
Comments