Leasehold and Freehold Reform Bill

Lord Best Excerpts

Committee stage
Monday 29th April 2024 Lords Chamber

This review will be a good positive start to identifying both the problems and how to resolve them. The main thing is that older people are being ripped off, and we are not able to develop a potentially lucrative housing sector because of our friend leasehold once more. Let us sort it out, do a review and see if we can come up with something better.

[Lord Best (CB)]

My Lords, I support Amendment 85 in the name of the noble Baroness, Lady Fox. This amendment calls for a government review of the retirement leasehold sector, covering a range of issues of special relevance to elderly and vulnerable leaseholders.

It is possible that some of the questions raised in this amendment will be covered by the forthcoming report from the Older People’s Housing Taskforce referenced in the amendment. This report is expected to be published in the summer, but I understand that it will be ready for Ministers to consider in the next few days. This government-initiated report, which fulfilled a promise to the All-Party Parliamentary Group on Housing and Care for Older People, which I co-chair with Peter Aldous MP, may answer some of the questions implicit in the noble Baroness’s amendment.

The amendment enables us to put on record the need for special support for leasehold housing designed and managed exclusively for older people. For example, I am hoping to see a recommendation in the task force report to tighten up on consumer protection for older people’s shared ownership leasehold schemes. Our APPG has heard horrifying stories of leaseholders, and their heirs and successors, finding themselves trapped into liability for fees and charges that make sales of the property impossible.

It would also be good to hear this evening of any news the Minister can bring us on implementing the recommendations of the Law Commission’s 2017 report Event Fees in Retirement Properties, aimed at developers which have been less than transparent in informing leaseholders of the exorbitant charges for which they would be liable.

A number of the issues highlighted by the amendment could be addressed by my later amendment on the regulation of property agents. The need for a regulator is of particular relevance to leasehold schemes for older people, who may be especially vulnerable to bad behaviour and incompetence of property agents. For all existing leaseholders, creating a properly regulated managing agent sector would weed out cases of poor conduct and ineptitude. The list of factors within Amendment 85, listing possible harms for older leaseholders, provides a helpful checklist for the issues which should be covered by a new regulator.

Meanwhile, those working in this field see a need to go further than the establishment of a regulator of property agents. ARCO—the Associated Retirement Community Operators organisation—which we heard about earlier, points to the different legislative structures in other countries. A Bill to switch future schemes from leasehold to what might be termed commonhold plus would enable new models of retirement housing to flourish; for example, there is a system of licences to occupy that has worked well in New Zealand, Australia and several US states. Indeed, an arrangement of this kind has worked extremely well for the retirement village in York created 25 years ago by the Joseph Rowntree Foundation, for which I had some responsibility.

After the Retirement Villages Act in New Zealand, which heralded a new framework for older people’s housing and care, production rose threefold, achieving all the well-known benefits from encouraging rightsizing: bringing previously underoccupied family homes into use for the next generation and providing an environment for older people that is sociable, affordable, safe and secure. Similar legislation in this country could achieve comparable results.

Sadly, at present, progress towards a major expansion of older people’s housing, preferably with care services on tap, is moving very slowly in the UK. Potential demand is estimated by Professor Les Mayhew at up to 50,000 homes per annum; but actual output is around 7,000 homes this year. The Older People’s Housing Taskforce should raise the profile of the relevant issues, and the review recommended in the amendment of the noble Baroness, Lady Fox, would take the matter forward. It would be great to hear from the Minister that, in the context of this Bill, elderly leaseholders can expect positive and specific changes for the better in the months ahead.