The Prime Minister’s Office has published a background briefing notes document in relation to the King’s Speech, alongside a copy of the speech itself. One item of note is the background information in relation to a proposed Leasehold and Freehold Bill.
The Leasehold and Freehold Reform Bill intends to deliver the Government’s manifesto commitments on leasehold reform; it will make long-term and necessary changes to improve home ownership for leaseholders in England and Wales, by making it cheaper and easier for more leaseholders to extend their lease, buy their freehold, and take over management of their building.
These reforms build on the Leasehold Reform (Ground Rents) Act 2022, which put an end to ground rents for new, qualifying long residential leasehold properties in England and Wales.
The Bill will seek to require transparency over leaseholders’ service charges – so all leaseholders receive better transparency over the costs they are being charged by their freeholder or managing agent in a standardised comparable format and can scrutinise and better challenge them if they are unreasonable.
Critically, the Bill will seek to replace buildings insurance commissions for managing agents, landlords and freeholders with transparent administration fees – to stop leaseholders being charged opaque commissions on top of their premiums (see page 45 of the Notes).