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In Focus Commercial Credit


Leasehold enfranchisement reform consultation: response


A major industry trade body has had its say on the future of leasehold regulation and where it can be improved


Beth Rudolf Director of delivery, the Conveyancing Association


Last month, we announced that we had responded to the Law Commission’s leasehold enfranchisement reform consultation. The consultation paper, entitled, ‘Leasehold


home ownership: buying your freehold or extending your lease’, was published in September last year and the deadline for responses passed on the 7 January 2019.


Relevant reforms In the response to the questions outlined in the consultation, we argue that any reforms should be relevant across England and Wales including: l The entitlement of leaseholders of both flats and houses to a lease extension of 999 years on payment of a premium. l The fact leaseholders should have a right to a lease extension at a nominal ground rent, plus they should have the choice to extend the lease without changing the ground rent, but at a reduced premium, and on the flip side should have the choice to extinguish the ground rent (without extending the lease) at a reduced premium. We argue that once the premium and


costs of a lease extension are reduced, more leaseholders will be able to benefit from the proposals and free themselves from the trap faced by those who have a lease with terms that are not acceptable to the major lenders. The ability to extend a lease which has a


term below 85 years, with the added ability to re-negotiate onerous clauses in the lease using prescribed wording, will make it


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We argue that once the premium and costs of a lease extension are reduced, more leaseholders will be able to benefit from the proposals and free themselves from the trap faced by those who have a lease with terms that are not acceptable to the major lenders


possible for existing leasehold owners to sell their property at its full market potential and have access to the whole of the leasehold lending market.


Fast track We are also calling for the introduction of a fast-track dispute resolution service which has jurisdiction over all lease terms, rather than just some. The First Tier Tribunal currently only


has limited jurisdiction on these matters and the redress schemes only has jurisdiction over service complaints in property management and not in connection with onerous lease terms, the fees charged or the timescales in which information is provided. In our response, we agree that new terms introduced into any lease extension should


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