Housing minister Matthew Pennycook has stated that a ban on new leasehold properties in England and Wales is unlikely to be implemented before the next general election, citing the complexity of the transition and the need to avoid negative impacts on housing supply and legal challenges.
Government's Gradual Approach
Speaking at a housing event in London, Pennycook defended the government's piecemeal strategy to dismantle the leasehold system, which has faced criticism from leaseholders burdened by high service charges and deteriorating buildings. He emphasized that the process must be rolled out slowly to ensure a smooth transition and to avoid undermining housing supply.
“I think it’s highly likely that we don’t switch on the ban in this parliament,” Pennycook told reporters. “It’s really complex, and so what we really want to do on all of these fronts is have all the primary legislation that we need to end leasehold in place … but switching on the ban involves some really quite complex trade-offs with housing supply.”
Consultation and Timeline
The government is currently consulting on the implementation of the ban, which was initially passed for new houses in 2024 and is expected to extend to new flats soon. Pennycook stressed the importance of determining a commencement date that aligns all stakeholders for a seamless transition.
“What we’re trying to get through this consultation is: what’s the commencement date where we’ve got everyone lined up in a way that the transition is going to be really smooth? That’s our objective,” he added.
Reforms and Criticism
As part of broader reforms, the government plans to ban new leasehold homes, cap ground rents, encourage conversion to commonhold, and boost shared ownership schemes. However, critics, including Green party leader Zack Polanski, accuse the government of backtracking on its election pledge, with Polanski making the issue central to his local election campaign.
Pennycook dismissed calls for an immediate end to the system, arguing it would be unlawful and impractical. “Those advocating for such an approach cannot answer how it would be lawful, how the impact on the mortgage market would be managed, how it would even be feasible for the land registry to delete millions of leasehold and freehold titles and replace them with commonhold ones overnight,” he said.
Harry Scoffin, founder of Free Leaseholders, warned that delays worsen the housing crisis, as developers use incentives like free furniture and service charge holidays to sell new leasehold flats.
