By ALEP Conference leads the way in addressing uncertainty in leasehold reform
Solicitors, valuers and other leasehold enfranchisement professionals met at the Royal College of Physicians to discuss the future of leasehold reform and to share the latest information about the timescale for the enactment of the various parts of the Leasehold and Freehold Reform Act 2024.
During the conference a live update was received in relation to the latest Human Rights Act challenges to the legislation and the publication of the Freedom of Information Act request that an ALEP member had obtained showing for the first time the identity of the seven claimants involved in this.
Clearly the timing of the valuation reforms is likely to be dependent on the outcome of these challenges and the latest news appears to be that there will be further steps in these cases in the new year.
Conference delegates heard from experts on a range of topics: the nature of Commonhold and the steps that any new Commonhold and Freehold Bill will need to address to make it ‘fit for purpose,’ the potential for human rights appeals in the context of the emerging legislation, and the increase in freehold disposals under the Landlord and Tenant Act 1987. Expert valuers also presented on the correct approach to valuation of very short leases.
The conference also provided on ALEP’s recent Supreme Court intervention, AP1 Properties v Tudor, which has led to a significant change in the evolution of case law relating to the validity of notices, in particular in the context of the Right to Manage but with wider implications as relayed by Mark Loveday and Philip Rainey KC who quoted a recent Upper Tribunal decision where this case has been applied.
Mark Chick, director of ALEP and a Partner at Bishop & Sewell LLP commented, “Our annual conference came at a time of huge uncertainty for leasehold enfranchisement – uncertainty which extends across professions but also to the five million leaseholders in England. With the Leasehold and Freehold Reform Act 2024 only partially commenced and a further Draft Leasehold and Commonhold Reform Bill on the horizon, there is considerable concern about how the laws surrounding leasehold will change and when. In the meantime, leaseholders are left unsure as to what path to take, freeholders face uncertainty as to the security of their investment and professionals s are not able to adequately advise.”
The level of uncertainty was clear in a live poll, in which participants were asked, “If you were advising the participants as at today, would you advise them to serve notice now or until the relevant part of the LFRA 2024 are in force?” 36.73% said that they would serve notice now, while a considerable majority (63.27%) would wait until the relevant secondary legislation was brought in.
Mark Chick continued, “Delegates gained valuable insight from experts including Mari Knowles of the Leasehold and Commonhold Experts and Dr Douglas Maxwell of Henderson Chambers, a leading expert on human rights and their interaction with property law.
Whilst delegates will have certainly ended the day better informed, the unanimous feeling was that the government must provide clearer direction and timelines. If not, it risks the property sector being paralysed through indecision, with knock on effects for the housing market more generally. The government’s stated aim to increase housing supply needs to sit more comfortably with its desire to make major reforms to land tenure.’
Specific issues which are yet to be addressed include whether any ground rent cap on existing leases will be considered and what the proposed Commonhold and Freehold Reform Bill will contain. A stated policy objective is to implement the Law Commission’s 102 recommendations for leasehold reform, if so this will be a major piece of work and the question is when and how government will look to achieve this.
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