Housing Minister, Rachel Maclean has confirmed that the Kings Speech during the State Opening of Parliament on 7 November 2023 will include details of a new Bill for protection for leaseholders that will likely ban leasehold property on new houses. Flats will continue to have leases granted given the communal living style in an apartment block.
Rumoured to be in the Bill
This is great news for leaseholders but we hope there will also be provision to cap fees when extending a lease or indeed buying the freehold.
It is all highly complex at present with a ‘marriage value’ worked out based upon the increase in the value of the property after completion of any lease extension. Values are worked out based upon the leasesholder’s property value before and after the lease extension plus the value of the freeholder’s interest in the land (ground rents lost and capital value of land) before and after the lease extension. Currently, guidance is given under the Leasehold Reform Housing and Urban Development Act 1993 for a 90 year lease extension but taking this up to 999 years may prove complex and perhaps new guidance should be offered on setting leashlder extensions based upon a freehold value.