The Leasehold and Freehold Reform Act 2024: what does it mean for my leasehold property?
- 17 July 2024
- Commercial Real Estate
The leasehold system in the UK has been subject to some unfavourable press for some time now. The National Leasehold Survey conducted in 2016 by The Leasehold Advisory Service, in conjunction with a firm of solicitors, delivered alarming findings. According to the survey over half of respondents regretted buying a leasehold property with two-thirds being dissatisfied with the service levels received from their managing agents. It is with this backdrop, the need for reform seemed crucial.
The Leasehold and Freehold Reform Act received the royal assent on 24 May 2024. Before we see the benefits, however, extensive secondary legislation is needed. Given the change in government following the general election, it is difficult to predict when this may take place. Although, the Act has been criticized for not going far enough in some areas, such as failing to introduce the ground rent cap or the ban on forfeiture of residential leases, there are various improvements that were covered:
the Act introduces an obligation to provide leaseholders with insurance details to include any fees for placing the insurance.
As mentioned above, the Act has addressed many areas of concern for leaseholders and hopefully with the secondary legislation following soon, we may see positive changes in the sector. However, there are many areas that are not covered by the new legislation: the Royal Institution of Chartered Surveyors, whilst providing thorough commentary on the Act, has renewed its calls for introducing regulation of managing agents. It also highlighted that one of the biggest concerns of recent years, which is rising service charge costs, is not being dealt with by the Act. It seems that there is yet much more work to be done but these are positive steps.
If you need assistance, get in touch with our Commercial Property Solicitors.
Keep up to date with the latest tips, analysis and upcoming events by our legal experts, direct to your inbox.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.