• Menu
  • Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Before Header

  • Home
  • What is LKP
  • Find everything …
  • Contact
Donate

Leasehold Knowledge Management Logo

Secretariat of the All Party Parliamentary Group on leasehold reform

Mobile Menu

  • Home
  • What is LKP
  • Find everything …
  • Contact
  • Advice
  • News
    • Find everything …
    • About Peverel group
    • APPG
    • ARMA
    • Bellway
    • Benjamin Mire
    • Brixton Hill Court
    • Canary Riverside
    • Charter Quay
    • Chelsea Bridge Wharf
    • Cladding scandal
    • Competition and Markets Authority / OFT
    • Commonhold
    • Communities Select Committee
    • Conveyancing Association
    • Countrywide
    • MHCLG
    • E&J Capital Partners
    • Exit fees
    • FirstPort
    • Fleecehold
    • Forfeiture
    • FPRA
    • Gleeson Homes
    • Ground rent scandal
    • Hanover
    • House managers flat
    • House of Lords
    • Housing associations
    • Informal lease extension
    • Insurance
    • IRPM
    • Jim Fitzpatrick MP
    • John Christodoulou
    • Justin Bates
    • Justin Madders MP
    • Law Commission
    • LEASE
    • Liam Spender
    • Local authority leasehold
    • London Assembly
    • Louie Burns
    • Martin Paine
    • McCarthy and Stone
    • Moskovitz / Gurvits
    • Mulberry Mews
    • National Leasehold Campaign
    • Oakland Court
    • Park Homes
    • Parliament
    • Persimmon
    • Peverel
    • Philip Rainey QC
    • Plantation Wharf
    • Press
    • Property tribunal
    • Prostitutes
    • Quadrangle House
    • Redrow
    • Retirement
    • Richard Davidoff
    • RICS
    • Right To Manage Federation
    • Roger Southam
    • Rooftop development
    • RTM
    • Sean Powell
    • SFO
    • Shared ownership
    • Sinclair Gardens Investments
    • Sir Ed Davey
    • Sir Peter Bottomley
    • St George’s Wharf
    • Subletting
    • Taylor Wimpey
    • Tchenguiz
    • Warwick Estates
    • West India Quay
    • William Waldorf Astor
    • Windrush Court
  • Parliament
  • Accreditation
  • [Custom]
Menu
  • Advice
  • News
      • Find everything …
      • About Peverel group
      • APPG
      • ARMA
      • Bellway
      • Benjamin Mire
      • Brixton Hill Court
      • Canary Riverside
      • Charter Quay
      • Chelsea Bridge Wharf
      • Cladding scandal
      • Competition and Markets Authority / OFT
      • Commonhold
      • Communities Select Committee
      • Conveyancing Association
      • Countrywide
      • MHCLG
      • E&J Capital Partners
      • Exit fees
      • FirstPort
      • Fleecehold
      • Forfeiture
      • FPRA
      • Gleeson Homes
      • Ground rent scandal
      • Hanover
      • House managers flat
      • House of Lords
      • Housing associations
      • Informal lease extension
      • Insurance
      • IRPM
      • Jim Fitzpatrick MP
      • John Christodoulou
      • Justin Bates
      • Justin Madders MP
      • Law Commission
      • LEASE
      • Liam Spender
      • Local authority leasehold
      • London Assembly
      • Louie Burns
      • Martin Paine
      • McCarthy and Stone
      • Moskovitz / Gurvits
      • Mulberry Mews
      • National Leasehold Campaign
      • Oakland Court
      • Park Homes
      • Parliament
      • Persimmon
      • Peverel
      • Philip Rainey QC
      • Plantation Wharf
      • Press
      • Property tribunal
      • Prostitutes
      • Quadrangle House
      • Redrow
      • Retirement
      • Richard Davidoff
      • RICS
      • Right To Manage Federation
      • Roger Southam
      • Rooftop development
      • RTM
      • Sean Powell
      • SFO
      • Shared ownership
      • Sinclair Gardens Investments
      • Sir Ed Davey
      • Sir Peter Bottomley
      • St George’s Wharf
      • Subletting
      • Taylor Wimpey
      • Tchenguiz
      • Warwick Estates
      • West India Quay
      • William Waldorf Astor
      • Windrush Court
  • Parliament
  • Accreditation
You are here: Home / Commonhold / Freeholders and housebuilders have plucked the leasehold golden goose, and now the path is clear for commonhold

Freeholders and housebuilders have plucked the leasehold golden goose, and now the path is clear for commonhold

May 27, 2021 //  by Sebastian O'Kelly

The leasehold sector gathered for the Westminster Legal Policy Forum today to pool views on the government’s leasehold reforms and the introduction of a revived commonhold.

Sir Peter Bottomley MP, co-chair of the APPG on leasehold and commonhold reform, chaired the opening session and housing minister Lord (Stephen) Greenhalgh ended it with a firm speech underlining his determination that these reforms go through.

Law Commissioner Professor Nick Hopkins gave a robust reprisal of his reports, which are the basis of the government’s reform agenda.

The meeting was reported by the Law Gazette here: https://www.lawgazette.co.uk/news/commonhold-focus-on-new-builds-could-boost-lender-confidence/5108658.article

There was some carping from leasehold lawyers, but overall most of the speakers warmly supported the case for change in leasehold.

Lord (Tony) Berkeley chaired the second session, fresh from defending the interests of leaseholders of the Duchy of Cornwall in the Lords debate on Monday.

Michael Voges, executive director of the Association of Retirement Community Operators, repeated his view that ground rents have no part in a revived retirement housing market. Sadly, a question asking whether he blamed leasehold for the parlous state of the retirement housing market – fewer than 2% of over 65s live in designated retirement housing – was not called.

Below is the speech I gave earlier to the Forum on why – this time – the commercialisers in the leasehold sector might not get away with nobbling a successful roll-out of commonhold:

The leasehold sectors’ lobbysts and lawyers – invariably one and the same – will quibble and maybe win a few skirmishes. But overall the battle to keep leasehold rip-offs is lost …

Like all campaigners seeking change, I live in a state of optimism that this time we will get it right and that, for all the ups and downs, I have believed that our creaking political system nonetheless had the flexibility to reform leasehold ever since I set up the Leasehold Knowledge Partnership nine years ago.

I appreciate that this state of mind will seem odd to the more jaded advocates of “leasehold reform” in the audience: especially those alleged enthusiasts of reform whose primary ambition, in fact, is to ensure that efforts to bring fairness to leasehold are neutered and that the income streams from the homes of ordinary people keep on flowing uninterrupted.

There are a number of grounds for optimism, even about commonhold, the subject of this talk.

First off, it actually exists on the statute book and has done since 2002.

The commercialisers – and their ever obliging little helpers, lawyers, chartered surveyors, the leasehold trade bodies, the government quangos filled with stooges – did their best to render that Act a failure, and were largely successful.

But commonhold, at least in principle, got through the net.

To make it work is our task now.

It is impossible to separate commonhold from the rest of the political engagement with leasehold reform.

Core to this is the Leasehold Reform (Ground Rent) Bill which was introduced to an overwhelmingly sympathetic House of Lords on Monday.

This very short Bill does one simple thing: it removes the sole legitimate income stream in leasehold and deprives leasehold of a future.

Without ground rents banks won’t lend to the punters who speculate in residential freeholds and house builders will have to reconsider how they are sorting out the tenure of their apartment blocks. [This excellent article by commercial solicitor Liam Spender explains how these investors are funded:]

Analysis of where next with the Leasehold Reform (Ground Rent) Bill

Indeed, they are already having to do so: Barratt has abandoned ground rents at its Blackhorse View site in North London, and Countryside Properties plc, Bellway, and Taylor Wimpey are doing the same, as is the commercially sophisticated Berkeley group, which builds prime Thames riverside flats.

All these companies are having to face the future without ground rents.

LKP states publicly and loudly – as I did on the BBC on Friday: absolutely no one should be buying a new property with ground rents anymore. That applies to the wider housing market, and – especially – to those considering a retirement property, where ground rents have always been very high because … well, because the developers could get a way with them.

Clear out ground rents and the path is clear for the wider reforms of leasehold outlined – at our prompting, by the way – by the Law Commission.

And those include commonhold.

But then look at what is going on right now in the wider leasehold world.

We have had the doubling ground rent scandal (18,000 homes) and aggressive more than 0.1% ground rent homes: around 100,000. And we have the long drawn out cladding and building safety scandal following the Grenfell fire, which impacts hundreds of thousands of flats.

These are blighted, and the leasehold resale market has collapsed by about half, according to Land Registry figures.

Leaseholders have always been the doltish, obedient consumers in this murky corner of the housing market. Moaning about its abuses, but quietly on the whole so as not to talk down the value of their homes. Dissatisfied consumers in this sector have one sure get-out: sell up and pass the problem on.

Now things are different.

We have seen demonstrations outside house builders sales suites in east London, and another in Ipswich. More are planned on June 5 and a big demonstration outside Parliament over leasehold cheating and cladding on July 15.

Around 35 Ballymore customers publicly spoke to the FT complaining about its inaction over cladding and excessive service charges. Think about that: they were publicly talking down the value of their homes in the media because they felt they had nothing to lose.

The message is absolutely clear to monetisers in the sector: you have plucked the golden goose and now at last it is getting angry and fighting back.

And they are informed, too. Cladding leaseholders know that the situation of commonhold flat owners in Australia is considerably better than that of those in England and Wales. (Scotland, very sensibly, is following the Australian road to remediation, not the English one.)

At risk blocks have been sorted first; loans have been issued to commonhold associations; legal actions have been taken against housebuilders and warranty providers. And to considerable degree this has long been done.

Who living in a flat in this country would not prefer the Australian approach to the cladding crisis compared with the expensive, delayed muddle that we have seen here?

And, of course, as yet we have not had any details of the forced loan scheme that the government is going to impose on leaseholders. That is, adding to the woes of young families coming out of lockdown with more debt to put right the cheating of cladding manufacturers; the incompetence of house builders – lack of fire compartmentalism etc – the failures of bureaucrats.

And who escapes scot-free from these disasters? Why the long term professional building owner, the freeholder.

The offshore private equity punter, hitching a ride on UK residential property values through the leasehold system.

He pays nothing. Indeed, he cleans up, putting right these build defects with his own management companies.

Billions are to be poured into the hands of these dubious entities, even though there is evidence ad nauseam of their sticky fingers.

These issues will be the motor that drives ahead commonhold.

The sectors’ lobbysts and the leasehold lawyers – invariably one and the same – will quibble and maybe win a few skirmishes. But overall this battle is lost.

Commonhold will come through because we are all living in the leasehold alternative, and it is a total failure.

Related posts:

Default ThumbnailGround rents to be allowed in retirement housing, says government Housebuilders WILL benefit from commonhold, Hopton Build developer tells Law Commission Commonhold is back! House builder offers flats without leasehold tenancies Labour to cap ‘legalised extortion’ of ground rents and end leasehold houses … Opposition and government now compete to reform leasehold Lawyers to Communities Select Committee: Stop ‘sticking plaster reforms’. End ‘draconian’ forfeiture. £10 ground rents a ‘mistake’. Make legal costs fair to leaseholders. Commonhold failed because developers make money out of leasehold …

Category: Commonhold, Ground rent scandal, Latest News, News

Latest Tweets

Tweets by @LKPleasehold

Mentions

Anthony Essien (34) APPG (36) ARMA (86) Bellway (30) Benjamin Mire (32) Cladding scandal (70) Clive Betts MP (31) CMA (42) Commonhold (51) Competition and Markets Authority (37) Countryside Properties plc (32) FirstPort (36) Forfeiture (29) Grenfell cladding (55) Ground rents (51) James Brokenshire MP (31) Jim Fitzpatrick (35) Jim Fitzpatrick MP (30) Justin Bates (38) Justin Madders MP (62) Katie Kendrick (35) Law Commission (59) LEASE (66) Leasehold Advisory Service (62) Leasehold houses (32) Long Harbour (44) Martin Boyd (78) McCarthy and Stone (39) National Leasehold Campaign (38) Persimmon (49) Peverel (61) Property tribunal (49) Redrow (29) Retirement (37) Robert Jenrick (33) Roger Southam (47) Sajid Javid (38) Sebastian O’Kelly (55) Sir Peter Bottomley (197) Taylor Wimpey (104) Tchenguiz (33) The Guardian (32) The Times (31) Vincent Tchenguiz (40) Waking watch contracts (40)
Previous Post: «Lord Blencathra House of Lords turns into the House of Serfs to attack the iniquity of leasehold ground rents
Next Post: Analysis of where next with the Leasehold Reform (Ground Rent) Bill Leasehold Reform (Ground Rent) Bill»

Reader Interactions

Comments

  1. paul

    June 3, 2021 at 8:28 am

    Many thanks! How would common-hold apply to ex-Local Authority flats? Would would own estates? Were the surrounding estate areas ever privatised and made properly chargeable areas? etc. etc.
    Gulliksen v Pembrokeshire County Council: CA 11 Jul 2002
    https://www.casemine.com/judgement/uk/5b46f1ec2c94e0775e7ee217

Above Footer

Advising leaseholders. Avoiding disasters.
Stopping forfeiture. Exposing abuses. Urging reform.

We depend on individuals for the majority of our funding.

Support Us and Donate

LKP Managing Agents

Become an LKP Managing Agent

Common Ground
Adam Church
Blocnet property management2

Stay in Touch

To achieve victory in the leasehold game where you are playing against professionals and with rules that they know all too well - stay informed with the LKP newsletter.
Sign Up for Newsletter

Professional Directory

The following advertisements are from firms that seek business from leaseholders.
Click on the logos for company profiles.

Footer

About LKP

  • What is LKP
  • Privacy and data

Categories

  • News
  • Cladding scandal
  • Commonhold
  • Law Commission
  • Fleecehold
  • Parliament
  • Press
  • APPG

Contact

Leasehold Knowledge Partnership
Open Data Institute
5th Floor
Kings Place
London N1 9AG

sok@leaseholdknowledge.com

Copyright © 2022 Leasehold Knowledge Partnership | All rights reserved
Leasehold Knowledge Partnership Limited (company number: 08999652) is a company limited by guarantee that is a registered charity (number: 1162584) with the Charities Commission.
LKP website is hosted at no charge by www.34sp.com
Website by Callia Web