LSG to submit proposals for leasehold reform



The Legal Sector Group (LSG) has published its complete proposals on leasehold reform.

Following a consultation, the LSG has drafted a wide-ranging policy document about reducing the potential for abuse of leasehold, speeding up the leasehold conveyancing process, increasing certainty for consumers and removing unreasonable costs.

The key areas in the proposals are:

•    Reasonable fees for administrative activities – covering a tariff of fees for quantifiable activities and the provision of standardised documents. 
•    Reasonable timescales for administrative activities – creating obligations for the lease administrator in terms of registration and their provision of information within a certain timescale.
•    Enforcement – with a mandatory requirement for all freehold management or leasehold administrators to be part of a redress scheme.
•    Unfair lease terms – covering initial lease terms, rent review clause, escalating ground rents, and exit/event or transfer fees.
•    Overhaul of tenure – covering a review of commonhold regulations and a simplification of the process to extend leases and convert to freehold.
•    Building insurance – obligations for landlords and requirements for lease administrators to ‘shop around’.
•    Management regulation – covering reserve funds on leasehold/freehold management block and costs of management charges.
•    Marketing of leasehold properties – covering the provision of upfront information on remaining term of the lease, ground rent, annual service charge, rent review clauses, lease clauses, etc. 

The LSG will be presenting the proposals to the Law Commission and has written to the new housing minister, Alok Sharma, outlining the proposals and requesting a meeting to discuss them further.

The LSG comprises the Conveyancing Association, the Chartered Institute of Legal Executives, Bold Legal Group and the Society of Licensed Conveyancers.

Beth Rudolf, director of delivery at the Conveyancing Association, said: “The LSG – along with a number of notable stakeholders and contributors – have now been able to publish these leasehold reform proposals, which we believe point the way ahead for a 21st-century leasehold process.

“We are looking forward to working with the Law Commission and the new government in order to make these proposals a reality.”


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