Brokenshire calls time on funding for “unjustified” leasehold homes

THE Government is pulling the funding plug on the delivery of “unjustified” leasehold homes.

The housing secretary, James Brokenshire MP used a speech he delivered at the headquarters of the think, the Policy Exchange to announce that government funding schemes will no longer be able to be used to deliver such properties.

It’s a move the Ministry for Housing, Communities & Local Government (MHCLG) says represents a “continuing push to tackle unfair and abusive practices within the leasehold system”.

“We have seen leaseholders in new-build homes facing unexpected costs rising every year that bear no relation to services and that’s not fair,” Brokenshire said. “So from now on any new government funding scheme will contain the condition that the money cannot support the unjustified use of leasehold for new homes.”

There are around 1.4 million leasehold homes throughout England, the ministry said. Leasehold generally applies to flats with shared spaces, supposedly making multiple ownership more straightforward, but MHCLG claims developers have been increasingly selling houses on these terms, adding further costs to “over-stretched” house buyers.

Under the proposals, changes will also be made so that ground rents on new long leases – for both houses and flats – are set to zero.

The leasehold crackdown wasn’t the only housing element to Brokenshire’s speech. Other measures include:

  • New proposals for three-year minimum tenancy terms, with a six-month break clause. The idea of this is to make renting more secure, helping renters put down roots, and to give landlords longer term financial security
  • The release of £450 million to speed up delivery of homes on sites of “surplus” public sector land, and encouraging modern methods of construction as a part of the building process
  • The launch of a new £100 million Community Housing Fund, to deliver “affordable” housing tailored to local needs, which the Government claims will put “communities in the driving seat”

“We need to get everyone on board to build at scale and pace to build the homes this country needs,” Brokenshire added. “But this isn’t just about getting the numbers up. We don’t have to make a false choice between quality and quantity. It’s also about building places that people are happy to call home. Places where they can come together in strong, thriving communities for generations to come.”


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