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Gething backs ‘long overdue’ leasehold reforms

Friday, 10 January 2025 10:45

By Chris Haines - ICNN Senedd reporter

Senedd.tv

Vaughan Gething called for "long-overdue" reform to the leasehold system, warning of injustice, iniquity and unscrupulous landlords fleecing households.

The ex-First Minister said new leasehold properties are still being created in Wales following a significant increase over the past two decades.

Leading a short debate on Wednesday, he told the Senedd: "Long leases – typically those exceeding 21 years – frequently require a leaseholder to pay an annual ground rent, for which the landlord does not have to provide a clear service in return or, indeed, any service."

"It is, effectively, a means for an unscrupulous landlord to lever money out of leaseholders with precious little effective right to challenge or oppose the demands."

Mr Gething acknowledged a Tory-introduced ban on ground rent in new leaseholds in Wales and England from 2022, but he warned existing leaseholders remain subject to rising rents.

'Unfairness'

The Cardiff South and Penarth MS raised concerns about the process for leaseholders to buy their freehold, citing the example of Hayes Point in his constituency.

"The unfairness of arms is again apparent," he said. "Determined leaseholders need to be able to give time, money and commitment, while the cards are still loaded in favour of the freeholder."

Mr Gething, who plans to stand down at the next election in 2026, warned it is far too hard for leaseholders to take up the right to manage their estates.

The former trade union lawyer cited examples of developers frustrating the process by not completing the estate, so the right to self-management does not crystallise.

'Trapped'

He said: "A number of leaseholders, therefore, are trapped, and there is still a lack of transparency about the fees charged...access to that information and how, practically people can exercise the rights that, in theory, they already have."

Mr Gething warned of the risks to leaseholders who can be landed with a bill for the freeholder's legal costs if they unsuccessfully pursue the right to manage.

"It's a large risk for many people to undertake," he said. "It should not, therefore, be surprising that many people give up before reaching the end of their journey."

He added that people can lose their homes, so many leaseholders end up paying service charges rather than challenging the fees.

Calling for pragmatism and warning of a lack of legislative capacity in Wales, Mr Gething was not in favour of a leasehold reform bill being introduced in the Senedd.

'Complex and challenging'

He instead advocated grasping the opportunity for the UK Parliament to legislate for Wales and England, with a bill expected to be introduced this year. Mr Gething warned leaseholders could otherwise wait years for a remedy and Wales would fall behind.

Jayne Bryant, who was appointed housing secretary by Mr Gething in July while he was first minister, agreed about the case for reform and the need for a Wales-and-England approach.

Ms Bryant said a leasehold reform bill, which is expected in the second half of 2025, will implement much-needed changes to ensure commonhold becomes a feasible alternative.

She told the Senedd: "The arguments for working jointly on leasehold reform remain strong."

"The law underpinning leasehold is complex and challenging...to navigate effectively, so working together on a common body of reformed law will reduce complexity, maximise clarity and coherence, and ensure that the new fairer...system applies to all."

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