Do you have relevant expertise and experience or a special interest in the Leasehold Reform (Ground Rent) Bill [HL], which is currently passing through Parliament? If so, you can submit your views in writing to the House of Commons Public Bill Committee which is going to consider this Bill
As we saw with the debate in the Commons, there is still plenty of opposition to the Leasehold Reform (Ground Rent) Bill and the monetisers’ little helpers in the lobbying industry will do their best to nobble it.
The volume retirement housebuilders – primarily Churchill Retirement and McCarthy and Stone – have put up a tough fight to be exempted from the ban on new ground rents.
They won a two-year reprieve, which is quite generous to allow them to continue providing income streams in their customers’ homes to benefit somebody else. And those somebodies are so attractive, with Vincent Tchenguiz through his Tchenguiz Family Trust based in the British Virgin Islands owing the lion’s share (albeit indebted) of retirement freeholds, including the pre-2010 McCarthy and Stone freeholds.
MPs want to hear from anyone who has “relevant expertise and experience” in the Leasehold Reform (Ground Rent) Bill.
That might include families who bought leasehold homes with aggressively escalating ground rents, like the victims of Martin Paine (described as a “crook who turns the slease of leasehold into an art form” according to Sir Peter Bottomley:
Or buyers of leasehold houses – a discredited scam of our plc housebuilders which has largely dried up, as a result of LKP’s efforts and those of the National Leasehold Campaign:
Or overseas buyers suddenly looking at massive bills racked up by debt collectors because they missed the ground rent payment for some reason:
Or those who bought leasehold properties – and were lent the money to do so by dopey banks – with 10-year doubling grounds, popularised by Taylor Wimpey, Countryside Properties plc and Redrow, among others:
Justin Madders, MP for Ellesmere Port and Neston, has taken a lead on these issues:
Leaseholders should submit their views – as soon as possible – in writing to the House of Commons Public Bill Committee which is going to consider this Bill:
The Public Bill Committee is now able to receive written evidence. The sooner leaseholders send in submissions, the more time the Committee will have to take it into consideration.
The Public Bill Committee will scrutinise the Bill line by line. The first sitting of the Public Bill Committee is expected to be on Tuesday 7 December and the Committee is scheduled to report by Thursday 9 December.
However, please note that when the Committee concludes its consideration of the Bill it is no longer able to receive written evidence and it can conclude earlier than the expected deadline of 5.00pm on Thursday 9 December.
You are strongly advised to submit your written evidence as soon as possible.
Aims of the Bill
The Bill applies to England and Wales. Its provisions, once in force, will restrict ground rents on newly created long residential leases (with some exceptions—see below) to a token one peppercorn per year. This effectively restricts ground rents to zero financial value. The intention is to make leasehold ownership fairer and more affordable for leaseholders.
The Bill makes exceptions for a small number of types of leases: business leases, statutory lease extensions of houses and flats, community led housing and home finance plan leases (either a type of equity release financial product known as a Home Reversion Plan or a rent to buy arrangement). Rent may continue to be charged on the landlord’s share of shared ownership leases, and where it is agreed on leases replacing pre-commencement leases on the remaining term of the pre-commencement lease (known as voluntary lease extensions).
The Bill places a duty on local weights and measures authorities (trading standards authorities) in England and Wales to enforce the Bill.
A breach of the ground rent restriction will be a civil offence for which enforcement authorities can impose a financial penalty of between £500 and £30,000. The money raised through financial penalties may be kept by authorities to fund their enforcement activities. They will also have the power to order the repayment of any unlawfully charged ground rent, plus interest, to leaseholders.
The Bill also prohibits the charging of administration charges in relation to peppercorn rents and makes provision for leaseholders to recover unlawfully charged ground rents through the First-tier Tribunal in England or the Leasehold Valuation Tribunal in Wales. That should deal with this, for example:
If enacted, the main provisions of the Act will come into force on a date to be specified by the relevant Secretary of State. But for retirement home leases (a lease relating to a dwelling that can only be occupied by people aged 55 or over), the Act’s provisions must commence no earlier than 1 April 2023. This is intended to give the retirement sector, where ground rents are often used to help fund the additional costs of providing communal spaces and facilities, additional time to transition