Approximately 10 million Britons find themselves navigating the complexities of home ownership through a leasehold system in England and Wales, facing extra costs like ground rents and service charges. As flat owners grapple with hefty repair bills for common areas, Michael Gove, the housing secretary, is expected to present measures aimed at protecting leasehold owners. Gove’s vision includes replacing leaseholds with a "commonhold" system, empowering owners to make joint decisions about shared spaces. However, Downing Street has expressed reservations, citing time constraints before the upcoming election.
The leasehold system, deeply rooted in historical practices such as serfdom and manorialism, has drawn criticism for its perceived unfairness. Many leaseholders face burdensome costs imposed by building owners, including contributions to repairs they might not support. The Home Builders Federation has warned of a looming crisis in housing supply, predicting a drop to post-World War II lows. Meanwhile, Gove aims to revamp the system by advocating for commonholds, a model adopted in other nations that grants property owners more autonomy over communal decisions.
“I don’t believe leasehold is fair in any way. It is an outdated feudal system that needs to go. And we need to move to a better system and to liberate people from it.” – Michael Gove
Gove's proposal finds backing among a significant portion of the electorate. A YouGov poll indicates nearly half of voters support abolishing leaseholds, while only 10% oppose the move. Harry Scoffin, cofounder of Commonhold Now, underscores the political opportunity, suggesting that adopting bold reforms could rejuvenate the Conservative party's standing among younger urban voters.
“There are up to 10 million votes in this agenda. The Conservative party would be well advised to be bold here and phase out the toxic landlord-controlled leasehold regime.” – Harry Scoffin, cofounder of Commonhold Now
Despite initial promises to eliminate leaseholds within the year, Gove will stop short of this commitment. Instead, he plans to introduce protective measures that empower leaseholders to contest unreasonable expenses. The Department for Levelling Up, Housing and Communities remains resolute in its mission to enhance protections for leaseholders.
“We are determined to better protect and empower leaseholders to challenge unreasonable costs.” – A spokesperson for the Department for Levelling Up, Housing and Communities
In addition to reforming leaseholds, Gove has retracted a mandatory target for councils to construct 300,000 new homes annually, opting to make it a voluntary goal instead. This decision comes amidst broader concerns regarding public fund management, leading to a ban on government spending for new capital projects.
“We have already made significant improvements to the market – ending ground rents for most new residential leases and announcing plans to make it easier and cheaper for leaseholders to extend their lease or buy their freehold.” – A spokesperson for the Department for Levelling Up, Housing and Communities
Despite these efforts, Downing Street has signaled caution about implementing such sweeping reforms before next year’s election. The feasibility of enacting these changes within a limited timeframe poses challenges for Gove's ambitious agenda.