Tories row back on plan to abolish ‘feudal’ leaseholds

PLANS to abolish the “feudal” leasehold system have been watered down by Rishi Sunak in his second about-turn within two days.

Michael Gove, the Levelling Up Secretary, has committed to put an end to the “outdated” property model across England and Wales. But the pledge will be left out of legislation later this year because such large-scale reform cannot be completed before the next election.

It will instead focus on quicker fixes, bringing in a cap on ground rents and making it easier for leaseholders to buy the freehold of their home.

The slimmed-down reforms came a day after No10 angered Brexiteers by ditching a bonfire of EU laws.

Mr Gove told MPS in January he would “absolutely” abolish the leasehold model and the Government would “bring forward legislation shortly”.

He has described it as “an outdated feudal system that needs to go”. Under leasehold buyers only own their property for a set period of time and usually have to pay maintenance charges and ground rent. There have been complaints that the model is unfair, with hidden fees often running into several thousands pounds a year.

Mr Gove wants to replace it with a commonhold system like the one used in Australia and the United States.

Under it buyers own their home indefinitely and have a much greater say over the management of their building and associated costs.

Government sources said the forthcoming legislation would be a “big step” towards a commonhold system and that plans for one haven’t been dropped.

Lisa Nandy, the shadow levelling up secretary, said: “In the space of a few months, this government has caved into backbenchers on housing targets, locked themselves in internal battles on making the basic improvements for renters and is now rowing back on leasehold commitments.”

A spokesman for the Levelling Up department said: “In line with our manifesto commitment, we will bring forward further leasehold reforms later in this Parliament.”