The Problem with Leaseholds

One of the most complex challenges faced by the newly formed Labour Group on Tamworth Borough Council is to do with Residents who live in Leasehold properties.

This is not a characteristic that is unique to Tamworth. An estimated 20% of England’s housing stock is held under leasehold, nearly 5 million leasehold homes in England. Leasehold ownership is for flats and other properties that share communal areas or services

Whilst it is true that Leasehold is often seen as little more than an inconvenience for many, there is a significant minority for whom the system goes seriously wrong and it can be life changing.

The range of problems Leaseholders we hear about include:

• Being unable to afford to buy the freehold
• Being charged for work that leaseholders didn’t want and cannot afford
• Difficulties in getting hold of freeholders
• Freeholders trying to evict leaseholders on dubious pretexts
• Leaseholders being unable to sell their property.

It has been pointed out that the prevalence of Leaseholds is largely a domestic problem. We are an outlier as Commonhold is the norm in most other countries. Commonhold was introduced in 2002 as an alternative to Leasehold and yet fewer than 20 Commonholds have been introduced in this country.

The Cooperative Party has stated that:

“There is no incentive for developers to relinquish the freehold (and many incentives not to). There is no easy pathway for leasehold enfranchisement and to implement a right to manage. Legislation is desperately needed to rejuvenate commonhold.”

Therefore I will be urging the Labour Group to put a Motion to Council which states that:

This Council resolves:

1. To write to the Secretary of State for Levelling Up, Communities and Housing requesting that the Government fulfils its pledge to end the sale of leasehold for new properties and implement the recommendations of the Law Commission in relation to leaseholder enfranchisement, reinvigorating commonhold and the right to manage.

• To seek to promote commonhold in new developments where possible