My suggestions to DCLG


Having read so much tripe from the great and the good, and accepting nobody will listen to the thoughts of one jaded leaseholder if only for proof of want of common sense in buying leasehold in the first place, I thought I would list my own suggestions as submitted.

In an ideal and fair world, long leasehold would be abolished and suitable means created to forcibly transfer (with reasonable only compensation) existing long leaseholds to Commonhold (a mark 2 version). But these islands are not known for fairness or equity when it comes to the commoner and land tenure.

Still, for what it was worth and having been invited, I gave my suggestions and backed them with analysis. I answered as a flat leaseholder only (or mainly) those questions that related to my situation. Here is my numbered list…

1 Initial ground rent: return to token ‘land ownership’ peppercorn rent. Meanwhile cap at 0.1% of value (Q14)
2 Maximum rate of increase: if not peppercorn, fixed doubling with cap of 0.1% of market value at all times.(Q14)
3 Rate of increase: Each third portion of the term (Q14)
4 Convert existing long leaseholds to commonhold. (Q17)
5 Meanwhile, existing leases should be capped back to third of term GR increments (Q17)
6 Leaseholder able to ‘buy out’ ground rent at fair present value separately to a lease extension (Q17)
7 Similar to marriage value of reversion, capitalisation of existing ground rents should be divided in two, compensating the landlord while not rewarding unfair contracts (Q17)
8 Simplify and strengthen consumer rights against unfair contract terms to explicitly include residential leases.(Q17)
9 “Onerous ground rent” should to be legally defined. (Q17)
10 Anyone charged enforceable sums by someone else for an alleged service cost should be able to challenge the reasonableness of that cost (Q20)
11 Abolish leasehold – replace with commonhold (Q21)
12 Billing transparency – require service charge and ground rent invoices contain a b/fwd balance showing previous invoice amount due and payments made since, i.e. a half yearly ‘charge account statement’.(Q21)
13 Accounting transparency – enforce a prescribed form of full trial balance served to leaseholders in place of obscure summary accrual accounts
14 Conveyancing leaseholds – enforce advertising as “Leasehold for sale”
15 Civil Injunctions should be available to leaseholders if landlords/agents fail to act reasonably, threatening loss of sale.
16 Require landlords/agents to comply with sales questionnaires on penalty.
17 Reform LPE1 leasehold sales questionnaire
18 Lease extensions – reverse the Mundy case
19 Simplify and strengthen rights to collectively enfranchise or extend existing leases at peppercorn rents.
20 Prescribe a Model ‘Statutory Lease Extension Deed of Variation’ (DoV)
21 Put lease extensions on to a transparent formulaic footing without court intervention
22 Remove the 2 year moratorium.
23 Curtail section 60 costs.
24 Void any landlord covenants that allow recouping legal costs for any reason incurred, or adding any other onerous terms.
25 RTM – reverse the Triplerose decision
26 Empower RTMCs to enforce lease terms and collect costs from miscreants without being beholden to the freeholder.
27 Allow RTMCs to operate own continuous trust bank account rather than depend on an agent.
28 Allow RTMCs to charge a per unit management fee under the service charge if self-managing without agents.
29 Allow RTMCs to charge for its directors and officers insurance.
30 Allow RTMCs to deal with consents without recourse to freeholder objection or duplication of fees.
31 Reform consents and fees into fixed tariffs
32 Provide clear leaseholder legal rights backed by civil remedy.
33 Put management codes of practice on a ‘must’ rather than ‘should’ status.

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