Last year more than 20 percent of homes in Lancaster and Fleetwood were sold as leasehold and reforms promised by the Conservative Government have still not been implemented, two years after they were first proposed.
Leasehold ownership, most commonly found in flats, means purchasing a home for the duration of a long lease rather than owning it outright. Homeowners who purchase a leasehold property are often faced with extortionate charges in the form of ‘ground rents’ or service charges and locked into restrictive contracts which were not properly explained.
Now Labour has revealed new plans to bring justice to constituents affected by the leasehold scandal. We will introduce a ban on the sale of new leasehold houses and flats. Leaseholders will be able to buy the full, freehold ownership of their home for 1% of the property value, with ground rents in existing leaseholds capped at 0.1% of the property value, up to a maximum of £250 a year.
Labour’s proposals mean the average household in Lancaster and Fleetwood would see their annual ground rent capped at £1,523, with the cost of buying their freehold reduced to just £152.
Other proposals set out by Labour today include a crackdown on unfair fees and contract terms, a right to challenge unfair fees or poor service, new rights to empower leaseholders to hire and fire their managing agent or to take over management of their homes themselves and a promise to revitalise commonhold: an alternative to leasehold – forms of which are used successfully across the world.
I continue to call for a full public inquiry into mis-selling in the leasehold market which saw thousands of properties sold with extortionate terms such as doubling ground rents, making them unsellable.
England is one of the only places in the world which has failed to move away from this feudal system. Across the world, modern alternatives like commonhold have flourished. Labour will improve and revitalise commonhold for flats and make freehold mandatory for all new houses – as the Conservatives should have done years ago.