Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Levelling Up, Housing and Communities, what steps his Department is taking to (a) retrospectively amend and (b) amend existing unfair leasehold contracts.

We are taking forward a comprehensive programme of reform to end unfair practices in the leasehold market. The Leasehold Reform (Ground Rent) Act will put an end to ground rents for most new residential leasehold properties as part of the most significant changes to property law in a generation. It is absolutely right that leaseholders should know about the coming changes that might affect them. We are preparing a number of activities to help with this as part of ensuring a smooth implementation of the Act.

We understand the difficulties some existing leaseholders face with high and escalating ground rents. Unfair practices have no place in the housing market and the Government is committed to ending them. This is why we asked the Competition and Markets Authority (CMA) to investigate potential mis-selling of homes and unfair terms in the leasehold sector. The Government has welcomed the action to tackle potential mis-selling and unfair terms in the leasehold sector and wants to see homeowners who have been affected obtain the justice and redress they deserve.

The Leasehold Reform (Ground Rent) Act is the first of a two-part seminal legislation programme to reform the leasehold system in this Parliament. On 7 January 2021 the Government announced reforms to enfranchisement valuation, 990-year leases, and established a new Commonhold Council. We will reform the process of enfranchisement valuation making it cheaper and simpler for leaseholders to extend their lease or purchase their freehold. For leaseholders buying the freehold or extending their lease, we will also cap ground rent to 0.1% of the freehold value for the purposes of calculating the premium. We will also prescribe rates and introduce an online calculator which will make it simpler for leaseholders to find out how much it will cost them to enfranchise.