Leasehold Reform

Debate between Lord Beamish and Ashley Dalton

Tuesday 23rd May 2023 Commons Chamber

[Ashley Dalton (West Lancashire) (Lab)]

Thank you, Mr Deputy Speaker, for the opportunity to speak in this extremely important debate on a topic has a real impact on our constituents. Leaseholders have been crying out for reform for years, and the Government make promises but seem unwilling to act.

It is simply wrong that the system denies people the right to decide the future of their own home. Being stuck with high service charges while faults and leaks fail to get fixed, and a lack of transparency over what leaseholders are actually paying for, is a familiar story. As mentioned by the shadow Secretary of State, my hon. Friend the Member for Wigan (Lisa Nandy), with the exception of England and Wales, every country in the world has repealed or reformed the archaic leasehold model. There is cross-party consensus in this place that the current system simply does not work, so why are this Government sitting on their hands while the people out there pay the price?

[Mr Kevan Jones]

Does my hon. Friend agree that it is worse than that? The Government are not just sitting on their hands; they have raised expectations. Some of the comments from the Secretary of State in particular have led people to think that things are going to change quickly, when quite clearly they are not.

[Ashley Dalton]

I absolutely agree. It is an outrage that these promises give people hope, yet they turn into nothing. This is yet another example of the Government not matching the ambition of the British people.

I am sorry to say that the bad news just keeps on coming for leaseholders. As much as the Leasehold Reform (Ground Rent) Act 2022 made meaningful progress in all but abolishing ground rents for leaseholders of newly purchased new builds, reform for existing leaseholders has been kicked into the long grass. The UK housing market risks becoming a two-tier system for leasehold properties. There are 4.8 million existing leasehold properties and, unless reform comes quickly for those homeowners, new build leasehold properties will be seen by prospective buyers as more desirable since they are not subject to the same ground rent charges. That may well benefit developers, but leaves existing leaseholders stuck with unsellable homes and that has an impact on the entire market. An existing leaseholder unable to sell their property is unable to go and buy another, possibly freehold, property. The entire market is stagnating.

The Government keep promising that reform is just around the corner—if leaseholders just keep supporting the Government at another general election, they will really mean it this time and sort the problem out. The reality is that they have had 13 years to clean up this feudal model of home ownership, but they show no signs of doing it soon. We are talking about people’s lives. We cannot lose sight of the real consequences for people. As the Government continue to tease reform, some leaseholders who want to extend their leases dare not because they know there is no guarantee that the Government will follow through on their promise of further reform. Every day that the Government delay acting could cost leaseholders more when they do come to extend, pushing them closer to the cliff edge of marriage value having to be paid to extend a lease.

Britain is in the midst of a housing crisis: private renting costs are out of control; the disastrous Tory mini-Budget made it harder for millions to get a mortgage; and the leasehold model is clearly broken. The Government may have run out of ideas, but Labour would not only reform the broken leasehold system, but tackle the supply side of the housing crisis, building new homes and making them more attainable for potential buyers. While this Government make promises, Labour has a plan to deliver. Polling in recent months shows the public trust Labour more than the Tory party with the economy. With this Government’s failure to act on leaseholders and Labour’s plans to reform the system and support house building, the message is clear: Labour is also the party of home ownership.

There has been consensus across the House about the need to tackle the feudal leasehold system and tackle the exploitative practices that it enables, so what is the hold-up? Why are the Government all talk and no action? Will they please just get on with it?