Leaseholders are being “held hostage by a paralysis of policy,” according to Linz Darlington, managing director of lease extension specialists Homehold.
Darlington made the comments following the final Housing, Communities and Local Government Committee meeting, which reviewed the long-delayed draft Commonhold and Leasehold Reform Bill.
Speaking before the committee this week, housing minister Matthew Pennycook faced criticism from Darlington, who described his approach as defensive and overly focused on attributing delays to the previous government.
Darlington said: “Leaseholders have been waiting for years for it to be “cheaper and easier” for them to extend their leases. Following the testimony of Housing Minister Matthew Pennycook in today’s Select Committee, they could be waiting for many more years to come.
“The Leasehold and Freehold Reform Act 2024 was passed in the “wash up” period shortly before the last general election. However, the key provisions relating to lease extensions and freehold purchases have not been implemented.
“Delays in implementation are partly because further consultation and secondary legislation will be required to ascertain how lease extensions and freehold purchases should be priced under this new law.
“Matthew Pennycook’s tone relating to these provisions was notably defensive. He admitted that they could have consulted on these rates as early as September 2024, but stated that ‘I have seen people argue time and time again that we’re dragging our feet because we’re not doing the valuation rates consultation and that’s why we haven’t switched on. That’s not the constraint here.’
“Instead, he blamed the delay on a ‘small set of serious and specific flaws’ that need to be resolved – which he claimed the outgoing Conservative Government were aware of before they passed the legislation.
“Pennycook’s blame of the previous government is only half correct. If Labour had consulted on the rates promptly, they could have rectified these flaws by adding provisions to housing legislation such as the Renters’ Rights Act 2025.
“The minister confirmed that he intends to resolve these flaws in the Commonhold and Leasehold Reform Bill – which is still in the pre-legislative scrutiny phase. The practical result is that the implementation of the legislation already on the statute books is being tethered to the fortunes of a bill which has not even been formally included in a King’s Speech.
“It was accepted by the government that there will likely be further litigation from freeholders on these reforms. When pressed, Pennycook was unable to explain whether the legislation could be implemented while this was ongoing. Instead, he said that ‘Our contingency plan would be to robustly contest the legal action – it is about as simple as that.’
“It seems that any of this legislation is unlikely to benefit leaseholders until late 2028 at the earliest, but it could be much, much later.
“For leaseholders to benefit from these reforms, they must actually be implemented – not simply discussed or passed. While implementing elements of leasehold reform independently of each other could be argued to be ‘piecemeal’, it is better than bundling the issues together into ever more comprehensive, complex and contentious piece of legislation that is never ‘switched on’.
“Leaseholders are being held hostage by a paralysis of policy. They need actual progress and the ‘cheaper’ extensions they were promised, not more platitudes and political posturing.”
The Government is no longer trying to hide the fact that it has succumbed to the freehold lobby. You need only look at the fact that Ground Rents will only be capped at £250pa, but not until 2028 at least, and will then remain in place for the next 40 years, handing another £10,000 per leaseholder to freeholders… for zero value.
This will leave the ‘existing’ leasehold sector at a devastating disadvantage to properties which have a zero ground rent, further devaluing those properties, pushing leaseholders into negative equity which prevents them remortgaging (already happening), and ultimately, repossession.
That will be Labour’s legacy to nearly 5 MILLION leaseholders and their families.
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But the ground rent reserved was part of the bargain for the grant of the lease. The fact is a lot of those who cry (wolf) for reform being required are trying to wriggle out of the liability to pay a rent when the lease was granted. It is wrong on every basis for the state to presume to disrupt the bargain without proper compensation to the grantor.
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There speaks someone who isn’t blighted by leasehold.
It is proven that ground rent is a payment for zero value, and carries with it life-changing implications for leaseholders which, in the vast majority of cases, were not explained. Who, in their right mind, would have bought [the lease to] a property in the knowledge it could be taken from them for non-payment of a small sum, or that they would be unable to remortgage and face repossession?
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Ever has it been thus… Freeholders have been having it away on their toes for centuries now.
Leasehold reform started in 1888 but basically came to nothing until 1967 when a Labour Party eventually managed to get reform for leasehold houses.
In 1992, both the Labour and Tory parties made election pledges, and the 1993 Act was introduced by the Tories. However, although it initially looked like it was favourable to leaseholders, what it really managed to do was formalise a valuation methodology for an asset class that became commoditised from there on in.
Freeholders were incensed that leaseholders could band together and enfranchise. Apparently The Duke of Westminster even mentioned his irritation on Desert Island Discs some two years later!!!
But over three decades later, the freeholders have recovered from their initial shock and have actually found the situation to be very profitable.
Owning freeholds and charging leaseholders has always been iniquitous, it has always been about money and control.
But modern banking and accounting methods made it into BIG business.
Successive governments for about 140 years have failed ordinary people. It’s not this government, its all of them.
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