Leasehold system to be abolished

For years, the leasehold system has been a thorn in the side of many homeowners in England and Wales. With unfair ground rents, costly lease extensions, and the constant worry that you don’t fully own your own home, it’s no wonder campaign groups have been calling for change. And it now looks like that is finally happening. But what does the end of leasehold really mean for home buyers – especially those struggling financially or feeling stuck in their current situation?

What’s happening?

The government has announced plans to scrap the leasehold system for most new houses and overhaul the system for existing leaseholders. This could mean an end to escalating ground rents and give homeowners more control over their properties.

For anyone who’s ever felt trapped by unfair leasehold terms, this is good news.

Why has leasehold been a problem?

If you’ve ever owned a leasehold property (or considered buying one), you’ll know the headaches that come with it. Here’s why the system has been so unpopular:

• You don’t own the land – with leasehold, you’re essentially renting your home from the freeholder for a set period (sometimes as little as 99 years, though many leases are longer).
• Ground rents can spiral – some leaseholders have seen their ground rents double every ten years, making properties harder to sell.
• Costly extensions – extending your lease can cost thousands, and the shorter your lease gets, the more expensive it becomes.
• Service charges and permission fees – many leaseholders have been hit with unfair service charges and even fees just to make changes to their own home.

What this means for home buyers

If you’re currently looking to buy a home, the abolition of leasehold is great news. It means:

• More freehold properties on the market – future new build homebuyers will actually own their properties outright without having to worry about a ticking lease clock
• No more unfair charges – ground rents and extortionate fees could soon be a thing of the past
• Easier to sell in the future – buyers are often put off by leasehold properties, so freehold homes should be easier to sell when the time comes

What if you already own a leasehold property?

If you’re feeling stuck with an expensive leasehold property, you’re not alone. The good news is that the proposed reforms could make it easier and cheaper for leaseholders to buy their freehold or extend their lease.

The exact details are still being finalised, but if you’re currently trapped in a leasehold situation, you should monitor government updates or seek legal advice to find out about your options.