This follows the work of the APPG and its secretariat the Leasehold Knowledge Partnership in exposing the scandal of leasehold houses.
Today, Taylor Wimpey undertook to spend £130 million to address the issue after selling houses and flats with doubling ground rents between 2007 – 2011.
The report urges that commonhold tenure which was introduced in 2002 be to made to work or be abandoned.
Commonhold, which was introduced with the Commonhold and Leasehold Reform Act 2002, is the form of tenure arranging the ownership of flats which prevails in the rest of the world.
Only England and Wales persist with leasehold, a long tenancy, which puts home owners in a position of vulnerability in relation to the freeholder, or landlord.
Considerable powers are vested in the landlord – to appoint the management of a block, to collect ground rents, obtain loaded insurance commissions – even though the freeholder is invariably a minority shareholder in the block.
A freehold might only be worth five per cent of the collective value of the leases, yet has the preponderance of power.
The APPG rejects the Law Commission report on “event fees” – exit fees payable on resale of retirement flats. The Law Commission supports these deferred fees, provided they are transparent.
The APPG argues that they should be for the provision of a service.
The APPG urges the end of lease forfeiture, as recommended by the Law Commission in 2006.
With lease extensions costs, the APPG recommends that the cost of enfranchisement and extension be based on a formulaic model that does not require the mediation of tribunals.
The APPG wants right to manage to be simpler, and to remove the bar on RTM if 25% is commercial property.
With tribunal costs, the APPG argues for a simpler and fairer cost regime.
Consideration should be given to how the cost balance might be changed such that a landlord faces the same prospect of the leaseholder’s costs as the leaseholder might face against the landlord were it not for the cost advantage given to the landlord via the terms of the lease.
In conclusion the All Party Parliamentary Group argues for:
Government and parliament can act and have to act to reform leasehold.
Developers have to rectify the impact of their past behaviour on innocent leaseholders.
Owners of the freeholds of residential leaseholders have to end exploitation.
Unfair leasehold terms should be declared void.
Residential flat and house leaseholders deserve fair treatment.