The current leasehold property system in England and Wales is too complex, slow and expensive, says the Law Commission. And it’s come up with a radical set of proposals to reform the system to make it fairer to both leaseholders and freeholders.
Tasked by both the Ministry of Housing and the Welsh Government to review how leasehold works in both England and Wales, the Law Commission has now launched a consultation paper and asked the public to comment and make their own suggestions by the closing date of November 18.
With more than 4.2 million leasehold properties in England alone and a groundswell of opinion demanding the system is brought into the 21st century, the Law Commission is looking way to make enfranchisement – the process of extending an existing lease or buying out the freehold of the property – simpler, easier, faster and cheaper.
Consultation open to public
The commission also had to consider the rights of freeholders to receive appropriate compensation for their property interests. In leasehold, a leaseholder owns only the property and not the land on which it stands, which remains the sole preserve of the freeholder.
The homeowner pays an annual sum to rent the land for the length of the lease, which is usually lengthy. However, issues arise when the lease is close to expiring, in some instances making a property unsellable or unmortgageable. And when a lease expires, the property’s ownership reverts to the freeholder.
The Law Commission has published a consultation paper entitled Leasehold home ownership: buying your freehold or extending your lease that proposes:
- Making the enfranchisement process easier, cheaper and quicker;
- Improving and enhancing the rights of leaseholders to buy the freehold or extend a lease;
- Introduce a simpler unified procedure for houses and flats;
- Remove any limitations on the right to enfranchise - at the moment, leaseholders must have owned their property for two years before making a claim.
Paying twice for own home
Law Commissioner Professor Nick Hopkins said: "The current system is complex, slow and expensive, and it's failing homeowners. Many feel they are having to pay twice to own their home.
"Our proposals would make it easier and cheaper to buy the freehold or extend the lease of their home, ensuring the system works for ordinary homeowners across the country.
“We want to hear views from across the spectrum on how this complicated area of law can be improved."
Look to Fridaysmove for leasehold conveyancing
Here at Fridaysmove, we work with a panel of experienced property lawyers across England and Wales with vast knowledge of the leasehold property system. Talk to us to find a conveyancing solicitor who can deal with your sale or purchase of a leasehold property, help you extend the current lease on your property or start the process of buying the freehold.
We’re open seven days and you can get a no-obligation quote by calling 0800 038 6446 or use our online quote system for the leasehold conveyancing services you require.