Government to tackle unfair leaseholds by making all new build houses freehold

An Article by Samantha Hunter

Former Secretary of State, Rt Hon James Brokenshire MP announced the move as part of his speech at the Chartered Institute of Housing conference in Manchester in June.

The decision comes as a result of property owners being trapped with exploitative arrangements, whereby ground rents and other fees charged by freeholders and management companies can be extortionate.  Companies are also free to take as long as they like to provide information required by property owners in order to sell their homes, meaning delays and high costs to owners.

Brokenshire said the government recognises the unfairness in the leasehold market and that they have a responsibility to tackle this.  The proposals are part of the government’s commitment to ensure decent and fair housing for people that need them, and they have confirmed they are striving to deliver 300,000 new homes per year by the mid-2020s.

In order to assist property owners, the changes would see Homes England renegotiate the Help to Buy contracts to cease selling new leasehold houses, other than in exceptional circumstances, and ground rents would be reduced to zero.  This would prevent tax-payers money funding the unjustified sale of leaseholds.  Management companies would also be forced to provide required information within 15 days of the request and will only be able to charge a maximum of £200.00.

Brokenshire also said at the conference that anyone who was incorrectly sold a leasehold property, which could ultimately result in difficulty to sell, would be able to get their freehold at no cost to themselves.

Developers appear to be on board with the changes with at least 60 having signed the pledge. The changes already seem to be having an impact on the amount of leasehold properties sold, which have fallen from 11% to 2% just this year 1.

The news will no doubt be a relief to property owners and conveyancers, who cannot face the headache of a slow response to their requests for information leading to unnecessary delays in the conveyancing process.

Until the changes come into force, escalating ground rent remains a concern for lenders and DUAL Asset offer a policy to help protect lenders against loss as a result of the property owner failing to pay the ground rent and the landlord taking action under the Housing Act 1988.  Simply visit our website,, for more details about this policy and the other policies that DUAL Asset provide for both residential and commercial properties.

If you have any questions, please contact Samantha Hunter, Underwriter, DUAL Asset Underwriting on +44 (0)20 7337 2478 or [email protected]


[1] Press release by the Ministry of Housing, Communities and Local Government and the Rt Hon James Brokenshire MP (27/06/19)