The Committee Stage will commence on 22 April 2024.
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Changing landscapes in residential leasehold
2024
March
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Essential Reading: Our Insight
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House of Lords calls for property agent regulation
Essential Reading: Our InsightThe House of Lords Industry and Regulators Committee publishes letter to the Government following conclusion of its Inquiry into regulation of property agents recommending property agent regulation.
February
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Leasehold and Freehold Reform Bill concludes passage through House of Commons
Essential Reading: Our InsightThe third reading of the Bill in the House of Commons took place on 27 February 2024. The first reading in the House of Lords occurred on 28 February 2024. The second reading is on a date to be fixed.
January
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Consultation on capping ground rents in existing long residential leases
Essential Reading: Our InsightClosure of consultation on capping ground rents in existing long residential leases.
2023
November
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The Leasehold Reform and Freehold Bill presented to Parliament
Essential Reading: Our InsightThe Leasehold Reform and Freehold Bill is presented to Parliament. This is a wide-ranging bill which will make changes to lease extension, enfranchisement, right to manage, service charges and estate management charges.
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Government opens consultation on capping ground rents in existing long residential leases.
Essential Reading: Our InsightThe consultation: Modern leasehold: restricting ground rent for existing leases seeks views on capping ground rents in existing long residential leases and proposes five potential options for capping ground rents including imposing a peppercorn ground rent or capping ground rents based on the property value.
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The Leasehold Reform and Freehold Bill is announced during the King’s Speech
Essential Reading: Our InsightThe Leasehold Reform and Freehold Bill is announced during the King’s Speech. The text of the Bill will be available when presented to Parliament in due course. Key provisions include enabling leaseholders to seek a statutory lease extension to acquire an additional 990 year term, removing the qualifying requirement for a leaseholder to have owned a house or flat for 2 years before they can extend their lease by statute and extending rights to challenge reasonableness held by leaseholders to freehold owners in connection with estate management charges.
January
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Fire Safety (England) Regulations 2022 come into force in England
These require the Responsible Person in relation to a high-rise residential building to keep certain records and information (as described in the Regulations) where a building contains two or more sets of domestic premises and/or contains common parts through which residents would need to evacuate in an emergency.
2022
December
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The Telecommunications Infrastructure (Leasehold Property) Act 2021 comes into force
This Act received Royal Assent on 15 March 2021. Regulations were made bringing its provisions into force in England and Wales on 26 December 2022. The Act inserts new provisions into the Electronic Communications Code to allow operators to apply to the First-Tier Tribunal (Property Chamber) for code rights where a tenant of a block of flats wants to install telecommunications equipment, such as broadband, and a landlord has failed to respond to formal notice.
July
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Building Safety Fund reopens for applications
Essential Reading: Our InsightThe £4.5 billion Building Safety Fund reopens for applications. Accompanying guidance includes the criteria for making a new application.
June
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Leasehold Reform (Ground Rent) Act 2022 comes into force
Essential Reading: Our InsightThe Government has announced that the Leasehold Reform (Ground Rent) Act 2022, which received Royal Assent earlier this year, will come into force on 30 June 2022.
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Electric Vehicles (Smart Charge Points) Regulations 2021
These Regulations come into force on 30 June 2022 and make provision for certain residential and non-residential buildings to have one or a specified number EV charge points.
May
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RICS consultation on the Service Charge Residential Management Code
Closure of RICS consultation on the 4th edition of the Service Charge Residential Management Code.
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The Fire Safety Act 2021 comes into force
This is brought into force in England under The Fire Safety Act 2021 (Commencement) (England) Regulations 2022. It clarifies and extends the operation of the Regulatory Reform (Fire Safety) Order 2005 to multi-occupied residential buildings.
April
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Building Safety Bill becomes law
Essential Reading: Our InsightThe Building Safety Bill receives Royal Assent. This is a significant piece of legislation which will be implemented via secondary legislation.
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RICS opens consultation on the Service Charge Residential Management Code
The 3rd edition was published in 2016. RICS opens consultation on the updated 4th edition for landlords, leaseholders, managing agents, FTT appointed managers and occupiers of residential leasehold property.
February
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Leasehold and commonhold reform consultation
Closure of leasehold and commonhold reform consultation.
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Leasehold Reform (Ground Rent) Bill receives Royal Assent
Essential Reading: Our InsightThe majority of the provisions of the Act will come into force on a date to be appointed but the Government has committed to a date within 6 months (except for retirement homes).
January
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House of Commons Library publishes research paper on the growth in short term lettings
The research paper contains data on the number of short-term lettings, summarises calls from certain organisations for increased regulation of short-term lettings and reviews measures taking in Scotland, Wales, Northern Ireland and outside of the UK.
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Government launches consultation on leasehold and commonhold reform
Essential Reading: Our InsightThe Department for Levelling up, Housing and Communities publishes consultation: Reforming the leasehold and commonhold systems in England and Wales seeking views on a number of recommendations made by the Law Commission on enfranchisement and right to manage including raising the non-residential limit from 25% to 50% for collective enfranchisement and right to manage claims.
2021
December
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The New Homes Quality Board publishes a Code of Practice
Essential Reading: Our Insight -
Government publishes response to The Future Buildings Standard consultation
This is the second stage of a two-part consultation and builds on the Future Homes Standard consultation (see 19 January 2021). It includes recommendations for both non-domestic and domestic buildings. One of the proposals is for the Government to reduce overheating risk in new residential buildings and to introduce changes to ventilation standards.
November
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Government publishes response to consultation electric vehicle charging in residential and non-residential buildings
The Government proposes that legislation is introduced requiring:
- every new residential building with an associated car parking space to have a chargepoint; and
- every residential building undergoing major renovation with more than 10 car parking spaces to have cable routes for electric vehicle chargepoints for every car parking space.
Further proposals are made for non-residential buildings.
October
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Government publishes factsheets about the Building Safety Bill
Further ReadingThe factsheets provide information about key aspects of the Bill. These include a factsheet on dutyholders, buildings to which the more stringent regulatory regime will apply, safety cases, the Building Safety Regulator, accountable persons, refurbishments and more.
September
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Extension of Waking Watch Relief Fund
The Government announces that the Waking Watch Relief Fund will re-open for applications from 16 September 2021 to 10 December 2021.
August
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House of Commons Briefing Paper published on regulation of estate agents
The Briefing Paper outlines the steps taken by The Regulation of Property Agents Working Group and Government consultations on the regulation of estate agents. A code of practice is being developed for property agents in all aspects of residential property.
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House of Commons Briefing Paper published on leasehold and commonhold reform
The Briefing Paper summarises the proposed reforms to increase take up of commonhold, change the procedure to obtain a lease extension and enfranchise and to reduce ground rents in new leases to zero.
July
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Closure of Consultation on Personal Emergency Evacuation Plans in High Rise Residential Buildings
Closure of consultation: Personal Emergency Evacuation Plans in High Rise Residential Buildings
June
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Consultation on Personal Emergency Evacuation Plans in High Rise Residential Buildings
The Home Office launches a consultation on Personal Emergency Evacuation Plans in High Rise Residential Buildings to provide a tailored approach to evacuation to those residents who would have difficulty self-evacuating in the event of a fire.
May
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Extension of Waking Watch Relief Fund
Essential Reading: Our InsightThe Government announces that the Waking Watch Relief Fund will re-open for applications from 26 May 2021 to 24 June 2021.
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Government launches Commonhold Council
The Government announces the launch of the Commonhold Council which is an advisory panel of leasehold groups and industry experts drawn together to inform the Government on the Commohold model of home ownership.
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The Leasehold Reform (Ground Rent) Bill is published
Essential Reading: Our InsightThis Bill limits ground rent in new residential long leases to a peppercorn. The Bill will now make its way through Parliament.
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The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 come into force
Essential Reading: Our InsightThese Regulations enable individuals to apply for a standard breathing space moratorium or a mental health crisis moratorium. If a moratorium is put in place, this is likely to impact upon action which may be taken by landlords to recover arrears from that individual tenant.
April
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Fire Safety Act 2021 receives Royal Assent
Essential Reading: Our InsightThe Fire Safety Act 2021 is published, but not yet fully in force. It clarifies and extends the operation of the Regulatory Reform (Fire Safety) Order 2005 to multi-residential buildings.
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The Housing (Shared Ownership Leases) (Exclusion from Leasehold Reform Act 1967 and Rent Act 1977) (England) Regulations 2021
These Regulations come into force on 1 April 2021 and reflect the changes to the Government’s new shared ownership model which enables purchasers to buy an initial 10% share of a property. The Regulations relate to exemptions to the right to buy the freehold of a house and to Rent Act protection where there is a shared ownership lease where the purchaser owns a share of at least 10%.
February
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New Chief Inspector of Buildings Announced
Essential Reading: Our InsightThe Health and Safety Executive announces Peter Baker as the new Chief Inspector of Buildings who will oversee the establishment of the Building Safety Regulator.
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Closure of consultation on energy performance
Closure of consultation: Improving home energy performance through lenders
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Government announces additional funding for building safety
Essential Reading: Our InsightThe Government announces an additional £3.5 billion in funding to pay for the removal and replacement of certain cladding in high-rise residential buildings of 18 metres of above. In addition, a loan scheme is to be established for leaseholders in blocks of between 11 and 18 metres where cladding remediation works are required.
January
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Applications open for £30 million Waking Watch Relief Fund
The Government announced that the £30 million Waking Watch Relief Fund opened for applications (except in relation to Greater London which will be administered by the Greater London Authority (on a date to be announced) but not later than 22 March 2021). The fund is intended to pay the costs of installing a common fire alarm system in eligible residential buildings in England on or after 17 December 2020.
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Government responds to consultation on the Future Homes Standard
Essential Reading: Our InsightThe Government has announced that all homes and businesses will have to meet more rigorous new energy efficiency standards to lower consumption and bills.
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Government provides initial response to Law Commission’s proposals on commonhold and enfranchisement
Essential Reading: Our InsightThe Government announces that it will establish a Commonhold Council made up of leasehold stakeholders and intends to create a new right for leaseholders to extend a lease of a flat or a house by 990 years.
2020
December
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Government announces Waking Watch Relief Fund and extension to Building Safety Fund
The Government announces a £30 million Waking Watch Relief Fund for the installation of fire alarm systems in private sector high-rise buildings with unsafe cladding after 17 December 2020. In addition, the deadline to apply for the £1 billion Building Safety Fund for the removal and replacement of unsafe non-aluminium composite material cladding systems is extended from 31 December 2021 to 30 June 2021.
November
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Consultation on improvements to energy performance in homes
The Department for Business, Energy and Industrial Strategy launches a consultation: Improving home energy performance through lenders seeking views on the principles of how best to improve the energy performance of domestic properties with a mortgage through obligations on lenders. These include a potential requirement for all lenders to publicly disclose information on the energy performance of their portfolios.
October
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House of Commons Library Publishes Briefing Paper on Estate Charges
A House of Commons Briefing Paper: “Freehold houses; estate charges” is published. The paper provides background on the issues surrounding freehold estate charges and sets out the Government’s proposals for reform in England, which include a proposal to give rights to freeholders of private estates similar to the rights of leaseholders to challenge the reasonableness of service charges.
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Fire Safety Consultation
Closure of Fire Safety Consultation
September
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Draft Code of Practice for Regulation of Property Agents
Closure of consultation on the draft code of practice.
August
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Government publishes response to First Homes Consultation
The MHCLG recommends the introduction of a scheme which offers properties for sale with a 30% discount from the market value to people living locally who are first time buyers or key workers. The Government's response proposes:
- to give Local Planning Authorities powers to require a higher minimum discount of 40% to 50% provided there is evidence of a need for and viability of homes at a higher discount;
- price caps after the discount has been applied of £250,000 in England and £420,000 in London, subject to Local Planning Authority powers to set a lower price cap in certain circumstances; and
- eligibility criteria including income caps for applicants and restrictions on re-sale of properties within the scheme.
July
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Law Commission publishes reports on Enfranchisement, Right to Manage and Commonhold
Essential Reading: Our InsightThe Law Commission publishes its reports on Enfranchisement, Right to Manage and Commonhold proposing some fundamental changes to the residential leasehold sector including recommending commonhold to replace leasehold and overhauling the Enfranchisement and Right to Manage processes.
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New consultation on Fire Safety
The Home Office publishes a consultation on Fire Safety to strengthen the Regulatory Reform (Fire Safety) Order 2005 and implement the Grenfell Tower Inquiry Phase 1 report recommendations.
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Government publishes draft Building Safety Bill
The Government has described the draft Bill as bringing forward “the biggest improvements to building safety in nearly 40 years”.
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Draft Code of Practice for Regulation of Property Agents is published
A draft overarching Code of Practice for the regulation of property agents is published upon which The Royal Institute of Chartered Surveyors and The Property Ombudsmen are consulting. The Regulation of Property Agents (RoPA) Steering Group will review responses after closure of the consultation on 4 September 2020.
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Government publishes estimates of the number of leasehold dwellings in England
The MHCLG has published a report estimating the number of leasehold dwellings in England in 2018/2019. The report estimates that there were 4.5 million leasehold dwellings in England representing about 19% of housing stock in England.
May
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First Homes Consultation
Closure of First Homes Consultation.
April
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Government publishes response to Building safety Consultation
The headline announcements from the Government’s response are:
- a new national building safety regulator within the Health and Safety Executive will be established;
- each building will have an accountable person (usually the owner or landlord receiving service charges) responsible for understanding and managing fire and structural risks and a building safety manager to perform those functions on a day to day basis;
- new rights for residents to obtain safety information and new rules requiring residents to co-operate with the building safety manager;
- for each building to have a golden thread of building information related to fire and structural safety to be held digitally; and
- existing residential buildings above 18 metres will be subject to the new regime once they are occupied and there will be a transitional period for compliance, further details of which will be provided by the Government during 2020.
March
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Stay of possession proceedings during Coronavirus outbreak
Essential Reading: Our InsightFollowing the Coronavirus outbreak, a new Practice Direction is introduced into the Civil Procedure Rule 1998 which stays all new and existing possession proceedings including proceedings for forfeiture of long leases for 90 days from 27 March 2020.
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The Fire Safety Bill
The Government introduces the Fire Safety Bill into Parliament to bring multi-occupied residential premises into the scope of the Regulatory Reform (Fire Safety) Order 2005.
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Funding for replacement of non-ACM cladding on high-rise residential buildings
The Government announces a £1 billion fund in 2020 to 2021 for the removal and replacement of unsafe non-aluminium composite material cladding systems (including high-pressure laminate, wood and other class C/D cladding) from high-rise residential buildings in both the private and social housing sectors.
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Housing Ombudsman and revised scheme
The Housing Ombudsman publishes a revised Scheme giving stronger powers in relation to housing redress. The Scheme will take effect from 1 July 2020 and will include:
- a new power that allows the Ombudsman to issue complaint handling failure orders where complaints are not properly dealt with by landlords;
- the ability to make a severe maladministration finding and a requirement for a landlord to demonstrate learning after a decision of the Ombudsman; and
- developing a new complaint handling code.
February
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Competition and Markets Authority: update report
The Competition and Markets Authority (“the CMA”) publishes an updated report on their investigation into whether there have been breaches of consumer protection law in the residential leasehold housing sector and the next steps, including future enforcement action by the CMA and the areas where the CMA considers that the law needs to change in the future.
The CMA raises concerns in relation to:
- lease terms under which ground rents may initially be high and increase significantly over time doubling more frequently than every 20 years. The CMA estimates that there are around 13,000 leases with ground rents doubling more than every 20 years;
- high or escalating ground rents which could result in the lease becoming an assured tenancy under the Housing Act 1988 which may diminish security of tenure. The CMA estimates that there are around 57,000 homes where levels of ground rent exceed the threshold for an assured tenancy;
- increases in ground rent linked to the Retail Price Index;
- complaints about the mis-selling of leasehold houses;
- complaints about high permission fees and service charges. The CMA intend to publish information to assist homeowners to understand their rights and responsibilities;
- checks and balances. The CMA intends to work with the Government to introduce a clear statement when a property is advertised for sale of whether it is freehold or leasehold (including the remaining term of the lease) and an estimate of the annual costs of owning that property;
The CMA announces it will be taking enforcement action in relation to certain instances of mis-selling of leasehold property and to address high and escalating ground rents. Its investigation continues.
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New Homes Ombudsman and Consultation response
The MHCLG publishes its response to the consultation: Redress for Purchasers of New Build Homes and the New Homes Ombudsman. It announces that the Government intends to introduce new legislation obliging developers of new build homes to belong to the New Homes Ombudsman and to implement a code of practice for developers building and selling new build homes.
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Leasehold high-rise flats: who pays for the safety work?
A House of Commons Briefing Paper: Leasehold high-rise flats: who pays for fire safety work is published. The paper considers progress in implementing remediation works and issues raised by landlords and residents.
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First Homes Consultation
The MHCLG launches a consultation: First Homes. The consultation proposes the introduction of a scheme which offers properties for sale with a 30% discount from market value to people living locally who are first time buyers or key workers.
January
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Law Commission report on Enfranchisement valuation
The Law Commission publishes its report on options to reduce the price payable on enfranchisement. The report proposes three alternative schemes of valuation and a menu of sub-proposals which can be added to any of the three valuation schemes for the Government to consider. It concludes that whichever final valuation method is selected must sufficiently compensate a landlord for interference with its property rights.
2019
December
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New Building Safety Bill and Fire Safety Bill announced
In the background briefing to the Queen’s Speech, the Building Safety Bill and Fire Safety Bill are announced to put in place new regulatory regimes for building safety and extend the Fire Safety Order to building owners and managers of multi-occupied residential premises of any height. The Bills are not published in draft form.
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New voluntary valuation process for high-rise residential buildings
The Royal Institute of Chartered Surveyors, the Building Societies Association and UK Finance agree a new industry-wide voluntary valuation process in relation to buildings above 18 metres. The External Wall Fire Review Process requires a fire safety assessment to be carried out by a suitably qualified person and is valid for five years.
October
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Grenfell Tower Inquiry Phase 1 Report
Grenfell Tower Inquiry publishes Phase 1 report dealing with the events of 14 June 2017.
The Phase 1 report makes a finding at paragraph 2.16 that it was not the original intention “to include in Phase 1 of the Inquiry and investigation into the extent to which the building complied with the requirements of the Building Regulations. However…..there was compelling evidence that the external walls of the building failed to comply with Requirement B4(1) of Schedule 1 to the Building Regulations 2010, in that they did not adequately resist the spread of fire having regard to the height, use and position of the building.”
A number of recommendations are made in the report to introduce new legislation to require owners and managers of high-rise residential buildings to provide specific information and documentation to local fire and rescue services and to inspect fire doors to ensure they comply with applicable legislative standards. In addition, owners/managers of all residential buildings (not limited to high-rise buildings) to provide fire safety instructions for all occupants in the building.
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Electric vehicle charging in residential and non-residential buildings
Closure of consultation: Electric vehicle charging in residential and non-residential buildings.
September
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Making home ownership affordable
Closure of consultation in respect of the discussion paper: Making home ownership affordable.
August
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Government proposes new model for shared ownership
The MHCLG publishes a discussion paper on making home ownership affordable which proposes to introduce a simplified model for shared ownership of residential properties.
The main proposals are the introduction of a new national simplified model for shared ownership, permitting increases of shares by 1% or more (currently the minimum incremental increase is 10%) and the removal of pre-emption clauses allowing landlords an exclusive right to market the property for eight weeks.
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New Homes Ombudsman Consultation
Closure of consultation: Redress for purchasers of new build homes and the New Homes Ombudsman: a technical consultation.
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Leasehold and Commonhold Reform Briefing Paper
The Housing, Communities and Local Government Select Committee publishes an updated Briefing Paper on Leasehold and Commonhold reform.
July
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Building safety Consultation
Closure of consultation: Building a safer future: proposals for reform of the building safety regulatory system.
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Recommendations on the regulation of property agents
The working group on Regulation of Property Agents publishes its report. The main recommendations are:
to regulate property agents by creating an independent regulator and introducing mandatory qualifications and a code of practice;
regulation to cover estate agents in the UK and letting and managing agents in England together with auctioneers, property guardian providers and online agents but not online portals;
introduce a mandatory licensing scheme overseen by the regulator; and
establish a new public body to undertake the role of regulator. -
Electric vehicle charging in residential and non-residential buildings
The Department of Transport publishes a consultation: Electric vehicle charging in residential and non-residential buildings proposing to alter building regulations for new residential buildings to include requirements for electric vehicle charge points.
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Government response to Leasehold Reform report
The Government publishes its response to the Housing, Communities and Local Government Select Committee Report on Leasehold Reform.
The Government confirms in its response that it agrees the following recommendations of the Committee:
- give clearer information to consumers on how to buy and sell leasehold properties;
- supports the increased use of commonhold which the Government will consider further when the Law Commission’s Report on commonhold is published;
- introduce a standardised “key features” document to assist consumers with the details of the lease before a purchase;
- future ground rents to be capped at no financial value;
- explore changes to the legislation surrounding legal costs;
- seek proposals from the Law Commission on changing the law of forfeiture; and
- require all freeholders of leasehold properties to be a member of a redress scheme.
June
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New Homes Ombudsman Consultation
The MHCLG publishes a consultation: Redress for purchasers of new build homes and the New Homes Ombudsman: a technical consultation. The consultation seeks views on the role of a New Homes Ombudsman including its powers and a code of practice for developers of new build homes.
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Government takes forward Leasehold Reform proposals
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CMA launches investigation
The Competition and Markets Authority launches a formal investigation into the leasehold housing market.
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Building Safety Consultation launches
The MHCLG publishes a consultation: Building a safer future: proposals for reform of the building safety regulatory system. The proposals include a new regime for residential buildings over 18 metres and the introduction of the concept of a “golden thread” of information on the structure of the building and changes made to it to be held digitally and updated throughout the life cycle of the building. In addition, new concepts of “dutyholders” and “accountable persons” to have clear responsibilities (to be defined in legislation following the consultation).
May
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New Government fund for ACM cladding
The Government announces a £200 million fund to replace unsafe aluminium composite cladding from privately owned buildings over 18 metres high with applications to be made by 31 December 2020.
April
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Law Commission Consultation on Right to Manage
Closure of the Law Commission’s Consultation: Leasehold home ownership: exercising the right to manage.
March
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New industry pledge on ground rents
The MCHLG announces 40 developers, agents and landlords have signed up to an industry pledge agreeing not to include a clause in any new lease for ground rent to double more frequently than every 20 years and to identify and amend any existing leases within their portfolios where those clauses are present and include a link ground rent increase to RPI.
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New report published on Leasehold Reform
The Housing, Communities and Local Government Select Committee publishes its report following its inquiry into leasehold reform.
The headline recommendations made by the Committee include:
- a proposal for commonhold to become the main ownership model for flats in England and Wales;
- for the Competition and Markets Authority to investigate mis-selling in the leasehold sector;
- to introduce a standardised key features document as part of a sales process identifying the tenure, the length of lease, ground rent etc;
- to ban financial incentives for buyers to use a Solicitor selected by a developer;
- to introduce legislation to remove onerous ground rents in existing leases and for ground rents in new leases to be a peppercorn;
- to restrict perceived onerous permission fees in existing leases;
- to introduce a standardised service charge demand;
- to introduce a new consultation process for leaseholders for major works in privately-owned buildings with a cap of £10,000 per leaseholder;
- to prevent freeholders from recovering legal costs through service charge or any other means where a leaseholder has been successful in legal proceedings against a freeholder.
Essential Reading: James Souter and Lauren Fraser - Is it the end of the road for residential leasehold?Essential Reading: James Souter and Lauren Fraser - Abolishing residential leasehold could create more problems than it will solve.
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Law Commission Consultation on Commonhold
Closure of Law Commission consultation Reinvigorating commonhold as an alternative to leasehold ownership.
January
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Law Commission report on Right to Manage
The Law Commission publishes a consultation Leasehold home ownership: exercising the right to manage.
The Law Commission’s intention is to simplify the right to manage (“RTM”) process and to give power to the First-Tier Tribunal (Property Chamber) to waive procedural mistakes so that less claims to acquire the RTM fail.
In addition, it proposes to relax the current qualifying criteria so that buildings with more than 25% non-residential parts could qualify for the RTM and to establish clearer rules for the transfer of information between the landlord and the RTM Company in relation to management matters.
It also proposes to permit an RTM Company to acquire the RTM over multiple buildings on an estate rather than, as is currently necessary, requiring a single RTM Company to acquire the RTM over a single building on an estate.
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Government response on housing redress
The Government publishes its response to Strengthening consumer redress in the housing market. Proposals include:
- establishing a Housing Complaints Resolution Service as a single point of access for tenants, leaseholders of residential premises, purchasers of new build homes and users of residential property agents;
- establishing a Redress Reform Working Group to develop proposals;
- creating a New Homes Ombudsman for buyers of new build homes; and
- requiring all private landlords to become members of a redress scheme.
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Law Commission Consultation on Enfranchisement
Closure of the Law Commission’s consultation: Leasehold home ownership: buying your freehold or extending your lease.
2018
December
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Law Commission Consultation on Commonhold
The Law Commission publishes a consultation paper: Reinvigorating commonhold: the alternative to leasehold ownership.
The Commonhold and Leasehold Reform Act 2002 introduced Commonhold as an alternative structure to leasehold. It allows for the ownership of a freehold flat within a larger residential development without leases or third party freeholders and there is no forfeiture because the unit holders own their freehold.
The Law Commission’s proposals for commonhold include that it should be possible to convert to commonhold without the unanimous consent of leaseholders and that the threshold for conversion should be 50% or 80% of long leaseholders of the flats in the building.
November
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Leasehold Reform Consultation
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Considering the case for a Housing Court: call for evidence
The MHCLG publishes Considering the case for a Housing Court: call for evidence to consider the experiences of private landlords in possession actions in the County Court, the experiences of Court and Tribunal users and views on the transfer of property cases from the Courts to the First-Tier Tribunal (Property Chamber) and vice-versa.
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New regulations for recognising Tenants’ Associations
The Tenants’ Associations (Provisions Relating to Recognition and Provision of Information) (England) Regulations 2018 come into force with the aim of making it easier for tenants’ associations of residential properties in England to become legally recognised and to obtain information from landlords about other tenants who have a legal right to join a tenants’ association. One of the main changes is to reduce the threshold for an association to be legally recognised so that it must be recognised where it represents at least 50% of the qualifying tenants.
October
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Government’s response to Residents’ Association Consultation
The Government publishes its response to Recognising residents’ associations, and their power to request information about tenants. It concludes that it intends to introduce new legislation in the autumn of 2018.
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New Leasehold Reform Consultation
The MHCLG publishes the Government’s consultation paper: Implementing reforms to the leasehold system in England: A consultation.
The consultation provides more detail on the Government’s proposals to ban the sale of leasehold houses and to cap ground rents in new residential leases. The key points are:
- a proposed ban on granting long leases of houses which will apply to any houses developed on freehold land at any time and on leasehold land acquired from 22 December 2017;
- a proposed cap to ground rents on new residential long leases at £10 per annum;
- a proposal to give freeholders the same rights as those currently held by leaseholders to challenge the reasonableness of service charges levied through a deed of covenant or an estate rent charge; and
- landlords and managing agents to provide leasehold information in connection with a sale within a fixed period of time (to be determined) and with their fees to be capped at an amount to be determined.
September
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Law Commission opens Consultation on Enfranchisement
The Law Commission publishes a consultation paper entitled: Leasehold home ownership: buying your freehold or extending your lease.
The consultation makes a number of proposals to overhaul the procedure for the leasehold enfranchisement of houses and flats including:
introducing a single scheme for “residential units” rather than separate schemes for houses and flats;
Lease Extensionabolishing the requirement to own the property for two years in order to qualify;
Individual Acquisition of Freehold
the qualifications based on financial limits such as the low rent test and rateable values to be removed;
new qualifying criteria that if there is more than 25% non-residential use then the building will not qualify (as already exists for collective enfranchisement claims);Collective Enfranchisement
introducing a requirement for the freehold to be purchased by a company limited by guarantee on behalf of the participating leaseholders unless there are less than four units;
permit collective enfranchisement of an estate rather than single blocks.
no further claim can be made for five years once a collective enfranchisement has concluded;
new right for non-participating leaseholders to later purchase a share in the freehold company;
Procedure & Valuationsingle procedure for lease extensions, individual freehold purchase and collective freehold purchase with standard forms;
the Law Commission’s stated aim is to provide a better deal for leaseholders as consumers and the consultation paper sets out alternative valuation options to seek to reduce premiums.
July
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New Inquiry into Leasehold Reform
The Housing, Communities and Local Government Select Committee launches an inquiry into leasehold reform.
June
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Government guidance on leasehold ownership
The MHCLG publishes a How to lease guide for current and prospective leaseholders setting out the difference between leasehold and freehold property and the rights, obligations and implications of being a leaseholder.
April
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Consultation on housing market redress
Closure of consultation: Strengthening consumer redress in the housing market: A Consultation.
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Government’s response to Consultation on the home buying and selling process
The MHCLG publishes its response to the call for evidence on improving the home buying and selling process and announces that it intends to publish guides on “How to Buy” and “How to Sell” with the aim of ensuring customers are better informed of the home buying and selling process and to potentially limit fees for the provision of leasehold information and to standardise the leasehold information form.
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Government announces new code of practice for letting and managing agents
The MHCLG publishes the Government’s response to the call for evidence on protecting consumers in the letting and managing agents market. The key proposals are:
- to establish a code of practice for letting and managing agents governed by an independent regulator;
- to require letting and managing agents to undertake mandatory qualifications in order to practice; and
- to set up a working group to develop a regulatory regime.
March
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Government’s response to Housing Market White Paper
The MHCLG publishes the Government’s response to the housing White Paper consultation: Fixing our broken housing market.
February
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New Consultation on housing market redress
The MHCLG publishes a consultation: Strengthening consumer redress in the housing market: A Consultation to examine options for improving consumer redress in housing.
2017
December
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Government’s response on tackling perceived unfair practices in the leasehold market
The DCLG publishes the Government’s response to Tackling unfair practices in the leasehold market. The proposals include:
- introducing legislation to ban new residential long leases for existing or new build houses (except in specific circumstances, to be defined);
- introducing legislation restricting ground rents in new leases to a peppercorn;
- introducing a right of first refusal for lessees of houses, as exists for leaseholders of flats;
- addressing the perceived loophole in respect of Ground 8 of the Housing Act 1988 whereby a landlord may seek possession of a long lease under Section 8 (designed for short tenancies) without having to comply with the statutory requirements in order to forfeit a lease for non-payment of ground rent; and
- introducing legislation so that freeholders who pay charges for the maintenance of communal areas and facilities have rights to challenge the reasonableness of service charges.
October
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Improving the home buying and selling process: Call for Evidence
The DCLG publishes a call for evidence seeking views on improving the home buying and selling process: Improving the home buying and selling process: Call for Evidence.
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Government announces call for evidence on letting and managing agents
The DCLG publishes a call for evidence on Protecting consumers in the letting and managing agent market seeking views on whether a new regulatory model is needed for agents in the leasehold and private rented sectors.
September
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Consultation on unfair practice in the leasehold market
Closure of consultation: Tackling unfair practices in the leasehold market.
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Consultation on Residents’ Associations
July
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Government publishes Consultation on tackling unfair practices in the leasehold market
The DCLG publishes a consultation: Tackling unfair practices in the leasehold market. The proposals include:
- banning the sale of new leasehold houses;
- limiting the starting value and increase of ground rents on all new residential leases over 21 years;
- updating Ground 8 of the Housing Act 1988 so that long leases over 21 years with an annual ground rent of over £1,000 in London and £250 outside of London cannot be an assured tenancy to close a perceived loophole whereby a landlord may seek possession of a long lease under Section 8 (designed for short tenancies) without having to comply with the statutory requirements in order to forfeit a lease for non-payment of ground rent. Where a lease is forfeited, as opposed to where a possession order is made under Section 8, the tenant has a right to apply for relief from forfeiture; and
- providing freeholders of estates with equivalent rights to leaseholders to challenge the reasonableness of service charges via the First-Tier Tribunal (Property Chamber).
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Government publishes new Consultation on Residents’ Associations
The DCLG publishes a consultation: Consultation on recognising residents’ associations, and their power to request information about tenants.
The Government proposes to make it easier for a secretary of a tenants’ association to obtain contact information of qualifying tenants from a landlord to increase the likelihood of the association being formally recognised under Section 29 of the Landlord and Tenant Act 1985.
February
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Publication of Housing White Paper
The then DCLG publishes a Housing White Paper: Fixing our broken housing market, commencing a consultation on changes to planning policy and legislation in relation to planning for housing, sustainable development and the environment.
The paper details the Government’s intention to review the planning system, and the private rented market to, in the Government’s words, “make renting fairer” for tenants and the leasehold sector to “promote transparency and fairness” by reviewing ground rent structures and the sale of leasehold properties.