Millions of homeowners will be given the right to extend their lease by up to 990 years and scrap ground rent, the Government has revealed.
Announcing, Housing Secretary Robert Jenrick said the move could save households “tens of thousands of pounds”.
Under existing laws, leaseholders can only usually extend their lease by up to 90 years.
But the latest reforms will allow both flat and house leaseholders to extend their lease to a new standard 990 years.
Likewise, existing rules enable freeholders to increase ground rent – defined as a contractual rental payment for the occupation of part of an area of land – whether it provides benefit or not to the leaseholder. This can also “lengthen and lead to increased costs” when buying or selling the property.
However, the new rules will mean that any leaseholder who chooses to extend the lease on their home will no longer pay ground rent to the freeholder, releasing the homeowner from “cumbersome bureaucracy and additional, unnecessary and unfair expenses”.
Commenting on the changes, Mr Jenrick said: “Across the country people are struggling to realise the dream of owning their own home but find the reality of being a leaseholder far too bureaucratic, burdensome and expensive.
“We want to reinforce the security that home ownership brings by changing forever the way we own homes and end some of the worst practices faced by homeowners.
“These reforms provide fairness for 4.5 million leaseholders and chart a course to a new system altogether.”
Described as one of the biggest reforms to English property law for 40 years, the move forms part of plans to make home ownership “fundamentally” fairer and more secure.
This also includes establishing a “Commonhold Council”, which will advise leaseholders in multi-property blocks on the benefits of commonhold ownership.
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