THE COMMONHOLD AND LEASEHOLD REFORM BILL
FACT SHEET No 1- SUMMARY
The Commonhold and Leasehold Reform Bill was introduced before Parliament on 21 June 2001. Information on the progress of the Bill can be found on the Parliamentary web page at www.publications.parliament.uk/pa/pabills.htm.
Part I of the Bill introduces a new form of tenure called Commonhold. Commonhold will provide a better system for the future ownership and management of blocks of flats and other interdependent buildings with shared services and common parts. Commonhold will be available for new developments and the Bill contains provisions which will allow existing leaseholders to convert to Commonhold. Conversion from leasehold to Commonhold will only be possible where all of the leaseholders agree to participate and buy out any other interests involved.
The Government is aware that this may be a tough requirement to meet so the Bill makes key changes to the existing leasehold legislation that will help the large number of leaseholders who are unable to convert to Commonhold, or who do not wish to do so.
Changes contained in Part II of the Bill will: -
- introduce a new right to manage, which will enable leaseholders of flats to take over the management of their building without having to prove fault on the part of the landlord or pay him any compensation;
- make enfranchisement easier for both leaseholders of flats and leaseholders of houses;
- make lease extensions easier to obtain;
- allow leaseholder of houses who have previously extended their lease the right to buy the freehold of their property;
- improve the rights of those who have inherited a leasehold house from a deceased leaseholder who qualified for the right to extend and/or enfranchise;
- strengthen leaseholders' rights against unreasonable charges levied under their lease;
- strengthen accounting rules for leaseholders monies;
- require landlords to hold service charge funds in designated separate client accounts;
- make lease variations easier to obtain;
- strengthen the right to seek the appointment of a new manager;
- prevent landlords taking any action for unpaid ground rent unless it has been first been demanded in writing;
- prevent landlords from starting forfeiture proceedings until facts have been determined;
- consolidate and amend the existing Leasehold Valuation Tribunal provisions to make the LVTs more effective and efficient.
These reforms will redress the uneven balance between landlords and leaseholders, and give leaseholders a greater degree of control over the management of their homes, reflecting the substantial investment they have made. They are also intended to prevent unreasonable and oppressive behaviour by unscrupulous landlords, and would provide flexibility to tackle any new forms of abuse that may arise in the future.
Detailed fact sheets on the above proposals for leasehold reform are available from Matthew Pye at The Department for Transport, Local Government and the Regions, HPRS, Zone 2/J4, Eland House, Bressenden Place, London, SW1E 5DU. Telephone number 020 7944 3462 or by e-mail leasehold.reform@dtlr.gov.uk
If you require detailed information on the provisions for Commonhold please contact Commonhold Bill Team, Lord Chancellor's Department, Room 3N 5, 3rd Floor, Southside, 105 Victoria Street, London, SW1E 6QT. Telephone 020 7210 1986 |
