
THE PARLIAMENTARY REVIEW
Highlighting best practice
2| LONG HARBOUR
freeholders, its evolution is bringing
new benefits to leaseholders and
residents alike, but it has also brought
greater complexity. We believe that
with a regulatory framework fit
for a modern housing market we
can address these complexities and
protectconsumers.
Regulation will drive up standards and
encourage a greater understanding
and responsible use of the leasehold
ownership model. Educating
consumers and creating a more
transparent market must be an
underlying objective. All stakeholders
– freeholders, developers, managing
agents, estate agents and legal
advisers, in particular conveyancers –
acknowledge that we have not done
enough to inform consumers, so
improving the home-buying process
from the first point of inquiry should
have a profound impact on the
entiremarket.
This is just one of many policies the
Ministry of Housing, Communities and
Local Government have consulted on
as part of their wholesale review of
leasehold ownership that began in the
summer of 2017. We have welcomed
this as an opportunity to address the
problems facing our industry, and we
hope that the government acts on this
in forthcoming parliament.
Understanding the challenges
The lack of regulation in the leasehold
sector has allowed less than desirable
practices to emerge, and as a
result the leasehold tenure is under
intensescrutiny.
The most prominent of these has
been onerous ground rents, such as
those that double more frequently
than every 20 years. While affecting
only a fraction of the UK’s 4.5 million
leaseholders, this has been a hugely
damaging issue and one that’s
been rightly exposed by the media.
Likewise, the practice of developers
selling new houses with long leases
without good reason highlights how
consumers are vulnerable in the home-
buying process.
We have engaged with and
submitted evidence to the various
consultations issued by MHCLG, the
Law Commission and the housing,
communities and local government
select committee. While we agree with
a number of the recommendations
provided for improving the current
system, we have serious concerns over
two potential reforms on the table
which we strongly believe could make
life worse forleaseholders.
The first of these is the call
for widespread adoption of a
commonhold structure where
residents take on the joint
ownership and management of their
owndevelopments.
Before considering such wholesale
change, we should identify the
problems that this structure is
believed to fix and acknowledge
the merits of the current leasehold
system. Some of the most common
complaints from leaseholders today
stem from poor management practices
or disputes among residents, the
latter of which can be triggered
by emerging subletting practices.
Underlying challenges like this will not
The Lansdowne,
Birmingham
As professional
freeholders, we
oversee the
management
of properties in
a responsible
and efficient
manner. By
enforcing
covenants
within leases,
we ensure
residents have
quiet
enjoyment of
their homes
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