The Government did not specifically include redress for leaseholders in the December 2019 Queen’s Speech but, speaking during an oral questions session in the House of Commons this week, the Housing Secretary committed to a redress scheme. He also announced that a draft bill on banning leasehold houses and reducing ground rents would soon be published.
New Homes Ombudsman
A government-established redress reform working group was formed in January 2019 and has been working to establish a single point at which all complaints could be handled.
There has been a change of government since the group was convened, however, The Queen’s Speech did propose a New Homes Ombudsman, something that Propertymark has championed in our work on leasehold issues.
'We have committed to filling a gap in redress provision for leaseholders by making a redress scheme mandatory for freeholders who do not use managing agents.
'We will be bringing forward legislation on this in due course.' MHCLG statement
Clarity still needed
It is unclear from the Housing Secretary’s answers in Parliament whether a redress scheme would help existing leaseholders, or apply only after a New Homes Ombudsman is instated.
We know that the government has been extraordinarily keen to look at all aspects of leasehold property, whether enfranchisement, alleged mis-selling of property or rapidly escalating ground rents.
They are also keen that the consumer shouldn’t be penalised and should be fully informed as to all obligations before purchasing the property.
We’re not aware that a separate redress scheme for leasehold housing will be set up, but we are aware that the possibility of a New Homes Ombudsman is very real.
Leasehold: A Life Sentence?
Thousands of homeowners are stuck in leasehold houses they cannot afford to continue living in and cannot sell. We surveyed over 1,000 people who bought a leasehold house to explore the extent of the scandal which has left thousands of Brits trapped in leases with third parties.
