Tackling the leasehold scandal
As Labour’s Shadow Housing Minister I have launched a major new piece of housing policy: Labour’s New Deal for Leaseholders.
Leasehold is a symbol of our broken housing system, with millions of England’s homeowners feeling like they’ve bought their home but still don’t own it. The roots of leasehold ownership – in which you buy the right to live in a property for an extended time, but not the land itself – stretch back to the feudal middle ages and though the law has changed since then, the same fundamental inequality remains at the heart of the modern leasehold system.
Every other major economy has moved away from leasehold towards fairer, more modern forms of ownership. This week, I announced radical Labour proposals to end leasehold, to bring an end to the scandals affecting millions of leaseholders and fundamentally reform property ownership.
The five core pledges of Labour’s New Deal for Leaseholders are:
- End the sale of new private leasehold houses with direct effect and the sale of private leasehold flats by the end of our first term in Government.
- End ground rents for new leasehold homes, and cap ground rents for existing leaseholders at 0.1% of the property value, up to a maximum of £250 a year.
- Set a simple formula for leaseholders to buy the freehold to their home, or commonhold in the case of a flat, capped at 1% of the property value.
- Crack down on unfair fees and contract terms by publishing a reference list of reasonable charges, requiring transparency on service charges and giving leaseholders a right to challenge rip-off fees and conditions or poor performance from service companies.
- Give residents greater powers over the management of their homes, with new rights for flat-owners to form residents associations and by simplifying the Right to Manage.