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Workable’ Leasehold Reform Bill Required

07.02.24

A key policy objective of the new Leasehold and Freehold Reform Bill is to make it cheaper and easier for people to extend their leases and buy their freeholds.

However, the legislation is deafeningly silent on the prescribed rates that will dictate the cost of doing this. Instead, it delegates this important task to the Secretary of State.

Whether or not the bill will make lease extensions cheaper - or potentially hugely more expensive - will be decided outside of the scrutiny of the parliamentary process.

An example is that a lease extension on £200,000 and 80 years remaining could cost £4,000 under the current legislation. if the key "deferment rate" was reduced from the current 5% to 4%, the cost would more than double overnight to about £8,500.

Labour have been quick to pick up on the Conservatives' omission, with both Ruth Cadbury and Samantha Dixon commenting on it during the debate. The latter scathingly referred to the Conservatives' claim that the process would be cheaper as "unsubstantiated". What we need in this bill is not legislation missing key parts, but a workable piece of legislation that does what it says it is going to do.

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