At the ARMA conference today, Lakhbir Hans gives the overview re MHCLGs work on commonhold and rent charges and the reforms more generally.

Some highlights from today’s speech at the ARMA conference below. Lots of interesting developments !

Headline news is the idea that the ground rent ban or restriction will take effect on all new properties from 22.12.2017.

Also – managing agents are to be regulated.

Other key points by way of summary below:

‘Leasehold can work’ it’s not all bad.

There have been sector abuses.

Modern ground rents have grown, paying high rents with unfair clauses.

Consumers have not been aware of what they have been getting into.

Government wants to move forward on banning – leasehold houses and restricting new ground rents to a ‘peppercorn.’

There will be some exemptions- shared ownership, community led housing, and inalienable land – the crown and also the National Trust.

There is a commitment to housing supply and government wants to ensure that their actions do not affect this.

Any ban will affect leases granted after not likely to come to affect in until after 22.12.2017 –

It will not be possible to register a long lease of a house at the land registry once the ban comes in.

£10 fixed rent – is likely to stay.

The stewardship issue is also to be addressed and Government wants to look at how this might work. Could some people be allowed to charge a ground rent?

Ground rent may be permitted for shared ownership and retirement housing.

Freehold house owners will have some rights – the right to challenge estate management charges. The right to challenge per the service charge legislation will be extended to them.

Managers – as per the call for evidence – government wants to commit to a single mandatory code of practice.

There need to be nationally recognised qualifications for agents. There will be a register and an overarching regulatory framework. It will be an offensive to practice if not qualified.

Lord Best will be chairing a working group – ARMA are not included, but many other sector bodies will be.

Service charges are to be regulated- consent fees for leaseholders particularly are going to be looked at. Any charges will have to be transparent.

Working group to look at the way in which these sorts of fees could be regulated.

Lots to think about and news all round …

Mark Chick