King’s Speech puts the focus on leasehold and social housing

Rent control might have made the headlines a couple of weeks ago, but it didn’t feature in the Government’s plans for the next legislative session.

Amidst speculation around the Prime Minister’s future, today saw the Government present the King’s Speech at the State Opening of Parliament. With major changes to the private rented sector still underway through the Renters’ Rights Act, the Government’s housing priorities focused on social housing renewal and leasehold reform.

It will also bring in new rules to ensure private and social landlords invest in home upgrades that cut energy bills for renters as part of the Energy Independence Bill – something already set out as part of the Warm Homes Plan, with privately rented properties required to reach an EPC C by 2030.

Commonhold and Leasehold Reform Act

Following the draft legislation which was consulted on earlier this year, the Government has committed to reforming the leasehold system, including capping ground rents to £250 per year, falling to a peppercorn after 40 years.

It will also:

• Create a new legal framework for commonhold, allowing full freehold ownership of flats and a bespoke approach to communal living.
• Ban the use of leasehold for new flats, so that commonhold is the default tenure for development of flats.
• Make converting to commonhold easier for existing leaseholders.
• Abolish the leasehold enforcement regime of forfeiture, with a replacement that has stronger protections for leaseholders.
• Amend the Leasehold and Freehold Reform Act 2024 to make it cheaper and easier for leaseholders to extend their lease or buy their freehold.
• Create a new right for leaseholders in flats to request improvements such as a gigabit capable broadband connection.

Social Housing Renewal Bill

The Government also set out its plans to promote social housing investment in England, protecting existing stock and incentivising the building of more social homes.

In particular, the Bill will:

• Change rules around the Right to Buy scheme, reducing eligibility.
• Tidy up and streamline legislation by repealing unused elements of past legislation, such as the requirement for local authorities to sell high-value homes and to charge higher income tenants higher rents, as well as changes to the process for housing consents.

More information

We will scrutinise the detail of the Government’s announcements and publish a further analysis later this week.

Photo credit: ©House of Commons