HQN Leasehold Network News

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Leasehold Network Lead Associate Richard Waft, as well as other associates for the Leasehold Network, regularly find and outline the big news stories for members, while providing their own analysis and comments.

For more expert analysis, briefings and best practice for everyone working with leaseholders in social housing and wanting to improve service delivery, be sure to join The Leasehold Network. You can find out more here.

Government to publish draft legislation on post-Grenfell building regulations

The government looks set to publish draft legislation to implement a new post-Grenfell system of building regulation by the end of the month, with legislation expected to be in place in 2021.

However, some have said that this may be pushed back to no later than 14 June, the second anniversary of the Grenfell Tower fire.

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Residents warn waking watch was insufficient after fire in block with Grenfell-style cladding

Residents in a Manchester tower block with Grenfell-style cladding have expressed fears for their safety after a waking watch failed to rouse a number of people during a fire that broke out in the early hours of last Saturday.

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Grenfell inquiry families not being heard

The Grenfell Tower inquiry is failing to deliver on promises that it made to survivors and the bereaved, according to a group of 11 law firms representing victims’ families. Solicitors have accused the inquiry of leaving families “out in the cold” by not regularly communicating progress and showing an “alarming” lack of transparency.

Despite assurances that Sir Martin Moore-Bick, the inquiry’s chair, was expecting to deliver his interim report on the inquiry’s first phase by spring, a date for its release has not been disclosed.

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Government to fund and speed up vital cladding replacement

The Communities secretary, James Brokenshire, has confirmed plans for a multi-million-pound fund to fix private tower blocks wrapped in combustible Grenfell-style cladding in England after mounting public anger that dozens of freeholders and developers have refused to pay to make them safe.

About 20,000 people living in private leasehold homes are estimated to be affected by the risk caused by the now-banned plastic-filled panels, similar to those which helped spread the fire at Grenfell that killed 72 people.

Having spent months trying to persuade property companies to pay with only limited success, housing ministers have been persuaded of the need to step in with public funds.

A spokesperson for the Ministry of Housing, Communities and Local Government said on Wednesday that the lack of action by some private building owners was “completely unacceptable”.

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 James Brokenshire has confirmed a £200m fund to pay for the removal of Grenfell-style cladding will come from his departments existing budgets in a statement to Parliament.

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Minister hits out at UK property firms over £200m cladding bailout

 The behaviour of some of Britain’s biggest property owners has been criticised as ‘morally indefensible’ by the government after ministers were forced to launch a £200m taxpayer bailout to fix combustible Grenfell-style cladding on private residential towers around England.

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Leaseholders in London block pay nearly £3.5m for Grenfell-style cladding removal

Leaseholders living at a major development in central London have been forced to pay out millions of pounds to remove dangerous Grenfell-style cladding despite no work starting on the block.

Despite repeated ministerial pledges that leaseholders will be protected from the bills, residents at the Paddington Walk development have already paid nearly £3.5m in service charges for the removal.

Residents across the blocks now face an additional bill of £5.4m to cover fire safety work, which could mean some residents paying out tens of thousands of pounds each. They have been told by the development’s building management company, Paddington Walk Management, that work cannot begin until it receives all the money to fund the work.

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The Competition and Markets Authority (CMA) is to investigate the mis-selling of leasehold properties to test whether the most onerous leasehold terms, such as permission fees and doubling ground rents, might constitute ‘unfair terms’ as legally defined.

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MHCLG urged to closer monitoring of council commercial activity

With more councils considering house-building ventures, a new House of Commons committee report has said that MHCLG must start to formally monitor commercial activities and other non-traditional operating models adopted by local authorities.

The report from the Public Accounts Committee identifies “a complete lack of transparency” over MHCLG’s informal interventions in councils with financial or governance problems and the results of its formal interventions.

MHCLG is recommended to start formal assessment and monitoring of the scale of long-term risk that councils could have exposed themselves to through commercial investments and ventures.

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Post-Grenfell latest; cladding repairs to be expedited in private sector flats

The government, tired of excuses used by some building owners and protecting leaseholders from the costs, has announced that around £200 million will be made available to remove and replace unsafe aluminium composite material cladding from around 170 privately owned high-rise buildings.

This step has been taken after private building owners failed to take action and tried to offload costs onto leaseholders.

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CMA to investigate mis-selling

 The Competition and Markets Authority (CMA) is to investigate the mis-selling of leasehold properties to test whether the most onerous leasehold terms, such as permission fees and doubling ground rents, might constitute ‘unfair terms’ as legally defined.

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Week commencing 22 April 2019

Leasehold Technical Talk – Helen Muir

Leasehold Network Associate Helen Muir looks over some of the key news stories from the past month pertaining to leasehold and analyses what they could mean for the sector. Members can download the full technical talk document here.

Brokenshire assures over impact of no deal on housing market

A no deal Brexit would still see EU product requirements recognised as valid for sale on the UK housing market for a time-limited period, James Brokenshire has confirmed.

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Shared ownership households complain of housing segregation

Residents who own homes outright enjoy access to the facilities in complexes that often feature side or rear entrances for shared owners, like ‘poor doors’ used in social housing. But householders who own only a part of their homes have complained of the daily frustration and discrimination they feel at the practices. Segregation is often achieved through electronic key fobs that are programmed to deny access to parts of complexes.

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MHCLG considers second Right to Buy pilot ballot after low take-up

The government is considering a second ballot of the Right to Buy pilot for housing associations in the Midlands following unexpectedly low take-up. Sources said the idea has been discussed by the working group for the pilot, and the Ministers expected 3,000 sales to be funded through the £200m pilot.

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Government to end ‘no-fault’ evictions in private rental shake-up

Prime Minister Theresa May has announced plans to clamp down on landlords who evict tenants unfairly at short notice by abolishing so-called ‘no-fault evictions’. Plans are being put in place to draft legislation that would end Section 21 evictions, meaning landlords would no longer be able to evict tenants at short notice without good reason.

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September date set for Welsh letting fees law

A new law to ban unnecessary letting fees in Wales will come into force in September (assuming it receives Royal Assent) making it an offence to charge a tenant any payment that is not specified as a ‘permitted payment’ by the legislation.

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Week commencing 1 April 2019

Leasehold Legal – March 2019 – John Murray

The latest legal news of interest to leasehold teams, with commentary from Leasehold Network Lead Associate Richard Waft has been published. Members can download a full copy of this document here.

31% of ALMO Right to Buy stock not replaced in 2018

The latest National Federation of ALMOs annual report has shown the sector is still struggling with replacing stock sold through the Right to Buy.

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Week commencing 25 March 2019

Leaseholder pledge

A government-backed pledge which commits freeholders, developers, conveyancers and managing agents to taking concrete steps to help leaseholders who are stuck in unfair deals.

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James Brokenshire announces industry pledge to crack down on toxic leasehold deals

A new industry pledge to stop leaseholders being trapped in unfair and costly deals has been unveiled by the Communities Secretary, Rt Hon James Brokenshire MP. More than 40 leading property developers and freeholders have already signed the government-backed pledge.

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Week commencing 18 March 2019

Leasehold Technical Talk – March 2019 – Helen Muir

Leasehold Network Associate Helen Muir looks over some of the key news stories from the past month pertaining to leasehold and analyses what they could mean for the sector. Members can download the full technical talk document here.

MPs urge social landlords to draft a code of conduct to protect leaseholders

The government has been urged to introduce a code of practice for local authorities and housing associations that outlines their responsibilities to leaseholders living in social housing blocks, in a bid to crack down on unfair charges.

A report published by the Housing, Communities and Local Government Committee has called for wide-ranging reforms to the leasehold system amid concerns that homeowners are being badly treated across both the private and public sectors.

This includes the creation of a code of practice for social housing landlords, which would contain guidance on best practice for carrying out and charging major works on leasehold homes.

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The House of Commons Committee report with recommendations has been sent to the Government, the Competition and Markets Authority and the Law Commission, who all have two months to respond.

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Spring Statement impact – New £3bn Affordable Homes Guarantee scheme announced in Spring Statement

Chancellor Philip Hammond has used his Spring Statement to announce a new £3bn Affordable Homes Guarantee scheme. Hammond told the Commons the scheme would support delivery of around 30,000 affordable homes.

Further, some £717m from the Housing Infrastructure Fund will unlock up to 37,000 new homes on sites in West London, Cheshire, Didcot, and Cambridge.

Also announced were measures to help developers future-proof new build homes to meet low carbon heating and a Call for Evidence on an SME energy efficiency scheme.

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Home sales – Number of unsold housing association homes rises by 18%

The number of unsold English housing association homes has risen by 18% to more than 7,000, according to figures from the Regulator of Social Housing.

Taking into account shared ownership and outright market sale, the number of unsold homes rose to 7,193 at the end of December last year, the latest quarterly survey from the English regulator revealed.

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Other news

Guide for landlords: Homes (Fitness for Human Habitation) Act 2018

The Act came into force on 20 March 2019. It is designed to ensure that all rented accommodation is fit for human habitation and to strengthen tenants’ means of redress against the minority of landlords who do not fulfil their legal obligations to keep their properties safe.

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Commons committee states that flawed system leaves leaseholders at risk of exploitation by developers, freeholders and managing agents.

The Housing, Communities and Local Government Committee has called for wide ranging reforms to the leasehold system in a new report. The committee finds that the balance of power in existing leases, legislation and public policy is too heavily weighted against leaseholders.

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A round-up of the key recommendations in the report has been made by 24 Housing here.