The UK government has proposed significant reforms to homeownership, particularly focusing on banning new leaseholds in England and Wales. This initiative seeks to replace the contentious leasehold system with commonhold ownership, which would grant homeowners greater authority and transparency in managing their properties. Leaseholders currently face unexpected fees, poor maintenance, and significant control from freeholders, leading to widespread dissatisfaction. By transitioning to commonhold, residents would be able to co-own their buildings and oversee costs and maintenance decisions, addressing the existing power imbalance inherent in the leasehold model.
The government's move to ban new leaseholds aims to replace the controversial system with commonhold ownership, promising homeowners greater control and addressing complaints over spiraling service charges.
Under the leasehold system, homeowners do not own their property outright but merely purchase the right to live there, facing unregulated service charges and maintenance costs.
Housing Minister Matthew Pennycook described the current leasehold system as 'inherently unfair,' emphasizing that the new reforms will empower homeowners and improve their management of properties.
The proposed shift to commonhold ownership allows flat owners to co-own their buildings and manage costs and decisions, directly addressing the power imbalance created by freeholders.
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