Property Development

Ministry of Housing, Communities and Local Government written question – answered on 20th July 2020.

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Photo of Catherine West Catherine West Shadow Minister (Foreign and Commonwealth Affairs)

To ask the Secretary of State for Housing, Communities and Local Government, what assessment he has made of the effectiveness of the use of collective enfranchisement rights by property developers; and what steps he is taking to ensure the effective scrutiny of that procedure.

Photo of Luke Hall Luke Hall Parliamentary Under-Secretary (Housing, Communities and Local Government)

Enfranchisement rights are used by leaseholders to acquire the freehold of their buildings. Part I of the Leasehold Reform, Housing and Urban Development Act 1993, as amended by the Housing Act 1996 and the Commonhold and Leasehold Reform Act 2002 allows for collective enfranchisement, and lease renewal rights for leaseholders of flats.

The Government is looking to standardise the enfranchisement process and asked the Law Commission to review current arrangements to make them easier, quicker and cheaper. The Law Commission published its first report to Government, on the valuation aspects of enfranchisement, on 9 January 2020. The report, which follows a consultation by the Law Commission, sets out a number of options relating to valuation, including purchasing a freehold and extending the lease of a house or flat. Details can be found at https://www.lawcom.gov.uk/project/leasehold-enfranchisement/. The Law Commission will publish a report on the remaining aspects of enfranchisement shortly. The Government will carefully consider the proposals outlined in the Law Commission’s reports and set out its preferred way forward in due course.

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