Leasehold and Freehold Reform Act 2024

Official Summary

A bill to prohibit the grant or assignment of certain new long residential leases of houses, to amend the rights of tenants under long residential leases to acquire the freeholds of their houses, to extend the leases of their houses or flats, and to collectively enfranchise or manage the buildings containing their flats, to give such tenants the right to reduce the rent payable under their leases to a peppercorn, to regulate the relationship between residential landlords and tenants, to regulate residential estate management, to regulate rentcharges and to amend the Building Safety Act 2022 in connection with the remediation of building defects and the insolvency of persons who have repairing obligations relating to certain kinds of buildings.

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Overview

This bill makes significant changes to leasehold and freehold property laws in England and Wales, aiming to simplify the system and improve fairness for leaseholders. Key changes include making it easier for leaseholders to buy their freehold, clarifying service charge rules, and introducing greater transparency around landlord accounting.

Description

Leasehold Enfranchisement

The bill simplifies the process for leaseholders to purchase their freehold, aiming for a more straightforward and accessible procedure.

Service Charges

The bill introduces stricter regulations on service charges, requiring landlords to provide more transparent and detailed accounting information, potentially involving qualified accountants' reports. Changes are also made to the definition and regulation of "variable service charges".

Crown Application

The amendments explicitly bind the Crown to the provisions of this Part of the Bill.

Consequential Amendments

The bill includes numerous consequential amendments to other pieces of legislation to align with the changes to leasehold and freehold law. These amendments cover various aspects of property law and related procedures across multiple existing acts.

Government Spending

The bill's impact on government spending is not explicitly stated in the provided text. The changes primarily affect the responsibilities and costs of landlords and leaseholders, rather than directly increasing or decreasing government expenditure.

Groups Affected

Leaseholders: Potentially benefit from simplified freehold purchase processes, clearer service charge regulations, and greater transparency in landlord accounting.
Freeholders: May face increased obligations regarding transparency and accounting for service charges.
Landlords: May face increased administrative burdens and costs due to stricter regulations on service charges and accounting.
Accountants: May see increased demand for their services due to the new requirements for reports on service charge statements.
Local Authorities and other Public Bodies: Affected by consequential amendments to various acts concerning housing and property management.

Full Text

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