You will all be aware that this week has brought the announcement of sweeping changes to regulation in our sector.
These are still being clarified but please see a consolidated summary of the key changes below:
- Leasehold axed for all new houses.
- Help to Buy funding will immediately no longer be available for the purchase of a Leasehold House.
- Freeholders and Managing Agents must supply vital leasehold information within 15 days and at a maximum fee of £200 for anyone wishing to buy/sell a property.
- Restricting ground rents on newly built properties to a peppercorn (zero financial value). This will ensure leaseholders only pay for services they receive, as ground rent on newly established leases will be £0.
- Implementing measures to ensure charges that freeholders pay towards the upkeep of communal areas are fairer and more transparent, the Government will legislate to give freeholders equivalent rights to leaseholders to challenge the reasonableness of estate rent charges.
- Consultation on the creation of a New Homes Ombudsman to deal with property issues and disputes specifically relating to newly built properties.
To promote clarity, the Government will provide a legal definition of a ‘house’ as part of a forthcoming Bill. In the meantime, it agrees the definition of a house should not include properties that are above or below (horizontally divided) another property or associated structure (e.g. underground car park).
As a member of the CILEx Specialist Reference Committee, we are pleased to be one of a huge range of industry professionals being asked to contribute over the coming months as to what form the proposed new regulator should take.
If you have any clients who you believe may be impacted by these changes or are looking to vary their rent or acquire the freehold to their home, then please ask them to contact our expert, Lesley Price, below for a free no obligation enquiry as to how we can assist them navigate the changes.