A Fair Deal for Renters: Leasehold and Rental Reform announced in the King’s Speech

In addressing the House of Commons on Tuesday 7 November 2023, King Charles confirmed that the government will bring forward new bills on leasehold and rental reform, which should benefit the housing market.

He announced that ministers would bring forward a bill to reform the housing market by “making it cheaper and easier for leaseholders to extend their lease, purchase their freehold and tackling the exploitation of millions of homeowners through punitive service charges”.

He added “renters will benefit from stronger security of tenure and better value, while landlords will benefit from reforms to provide certainty that they can regain their properties when needed”.

The King added that the government would “deliver a long-term plan to regenerate towns and put local people in control of their future”.

The Leasehold Reform Bill

The Leasehold Reform Bill aims to empower leaseholders by making it cheaper and easier for existing leaseholders in houses and flats to extend their lease or buy their freehold.  The bill will also increase the standard lease extension term from 90 years to 990 years for both houses and flats, with ground rent lowering to nothing.  This news will be especially welcomed by those who own properties whose leases are or will soon fall below 80 years – as their properties will become easier to sell and mortgages agreed.

The government said the bill would ensure “leaseholders can enjoy secure, ground-rent free ownership of their properties for years to come, without the hassle and expense of future lease extensions”.

The bill will also aim to ban the creation of new leasehold homes and consult on capping existing ground rents. However, it is unclear at this point whether this ban applies to flats as well.

Renters Reform Bill

The Renters Reform Bill aims to support the 11 million private tenants and 2.3 million landlords in England.

The bill includes a manifesto commitment to abolish no-fault evictions, ending blanket bans on pets and creating a new Private Rented Sector Ombudsman.

Further initiatives include adding new mandatory ground for possession by landlords and stronger powers to evict anti-social tenants.

The bill will make it illegal to have blanket bans on renting to tenants in receipt of benefit or those with children, crack down on criminal landlords and protect the student rental market.

The bill will also speed up the court process so landlords can regain possession of their property if a tenant refuses to vacate, and scrap proposals requiring landlords to meet the EPC (Energy Performance Certificate) C threshold from 2025.

Although every effort has been made to ensure that the information provided in this article is accurate and correct, the information provided does not constitute any form of financial advice. We recommend that you take financial advice before making any financial decisions.