Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Levelling Up, Housing and Communities, what assessment his Department made of the impact of introducing the first part of leasehold reforms to prohibit ground rent on new build flats without bringing forward the corresponding changes to existing leaseholders.

The Government remains committed to creating a fair and just housing system that works for everyone and to delivering the second phase of our major two-part leasehold reform within this Parliament.

The Leasehold Reform (Ground Rent) Act 2022 will come into force on 30 June. The Act will make homeownership fairer and more transparent for thousands of future leaseholders, by preventing landlords under new residential long leases from requiring a leaseholder to pay a financial ground rent.

We understand the difficulties some existing leaseholders face with high and escalating ground rents. Unfair practices have no place in the housing market. This is why we asked the Competition and Markets Authority (CMA) to investigate potential mis-selling of homes and unfair terms in the leasehold sector. The Government has welcomed the action to tackle potential mis-selling and unfair terms in the leasehold sector and wants to see homeowners who have been affected obtain the justice and redress they deserve.

The CMA has secured commitments from Aviva, Persimmon, Countryside Properties and Taylor Wimpey to amend their practices, including commitments to remove lease terms that led to doubling ground rents, houses sold as leasehold and to support leaseholders to buy the freehold at the original price quoted. This is a hugely important step and demonstrates our determination to support affected leaseholders. We urge other developers to follow suit.