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Leasehold: Legal Costs

Answer

The Government is committed to promoting fairness and transparency for homeowners and ensuring that consumers are protected from abuse and poor service. We are taking forward a comprehensive programme of reform to end unfair practices in the leasehold market.

Under the current system, too many leaseholders find the process for extending their lease or buying their freehold (a process known as enfranchisement) too complex, lacking transparency and prohibitively expensive.

We will reform the process of enfranchisement valuation that leaseholders must follow to calculate the cost of extending their lease or buying their freehold.

The Government will abolish marriage value, cap the treatment of ground rents at 0.1% of the freehold value, and prescribe rates for the calculations at market value. The Government will also introduce an online calculator, further simplifying the process for leaseholders and ensuring standardisation and fairness for all those looking to enfranchise. These changes to the enfranchisement valuation process will result in substantial savings for some leaseholders, particularly those with less than 80 years left on their lease.

The Law Commission’s report on enfranchisement includes recommendations relating to lease extensions, including payment of costs incurred by this process and under the terms of the new lease. We will bring forward a response to these and the other remaining Law Commission recommendations in due course.

Secondary information

Type

Written question

Reference

21253

Session

2021-22

Subjects

Fees and charges Leasehold Legal costs Reviews

Link

View this Written question on www.parliament.uk