Remember The Poor Leaseholder, Guv

Leasehold seems to be something treated separately, not to be incorporated, in general housing jurisdiction and this seems odd in the context of the commitment that Governments have made in leasehold reform legislation. The Leasehold Reform Acts of 1993 and 2002 and the Housing Act 1996 made enormous steps in improving leaseholder rights, but in other initiatives the position of the lessee seems disregarded. There are several examples to consider.

The Government can only be congratulated for the Decent Homes programme, a public acceptance of the run-down nature of the council housing estates and an injection of some £19 billion into a 10-year project of improvement. However, why are they surprised by the reaction of public-sector lessees faced with almost unpayable service charge bills, often in excess of £40,000? It is interesting that a lessee of a flat in a run-down Council estate is probably facing higher charges than owners of luxury apartments in Chelsea and Belgravia.

The rising tide of protest from council lessees should not have come as a surprise to Government. Look at the proposals for Home Information Packs, twice as complicated and probably twice as expensive for lessees compared to freehold homeowners. Then there’s the potential time-bomb for flatowners in converted buildings posed by the Housing Act 2004. One flat in a converted building let to several individuals could result in the whole building requiring registration as an HMO, identification of a ‘manager’ and maybe major works, with no clarity on who should pay or how they should be enforced. Consider the otherwise laudable Disability Discrimination Act. But will this lead to the need for expensive adaptations to the entrance hall of your building, with attendant costs to the leaseholders?

I hardly need mention the proposals for relaxation of rules on brothels. Here, the total absence of any thought on the possible implications for flatowners resulted in the Home Office even neglecting to consult ODPM, let alone the leaseholders.

Why is there no forward thought on how new policies will impact on the leasehold sector? It’s as if Government feels that leasehold has been fully dealt with in the 2002 Act .

The Social Sector Working Party, chaired by LEASE to look at the problems of council lessees, has proposed that all new initiatives should include a ‘Leaseholder Impact Assessment’, i.e. how the proposals will affect the leasehold sector. This doesn’t seem unreasonable. There is already a requirement for a Regulatory Impact Assessment.

Leaseholders - part of society and a major part of the housing market - have an invisibility other than when being considered as an individual issue. It’s time, in the context of the major readjustment in power between leaseholders and landlords through the new rights, that Government should also consider the wider implications of what it does on flat-owners.