Thousands of leaseholders across Hertsmere are set to benefit from a major overhaul of England and Wales’ outdated leasehold system, following the Labour Government’s announcement that ground rents will be capped at £250 a year.
The reforms, set out in Labour’s draft Commonhold and Leasehold Reform Bill, represent one of the biggest changes to home ownership in generations. They will fundamentally rebalance power away from freeholders and managing agents and back towards the people who actually live in and pay for their homes.
Across the country, more than five million leaseholders and future homeowners are expected to benefit from stronger protections and clearer rights. For many families, this will mean immediate relief from ground rent charges that have become increasingly unaffordable, as well as renewed confidence that their homes can be sold or remortgaged.
Welcoming the announcement, Cllr Chris Gray, Cabinet Member for Economic Development at Hertsmere Borough Council, said:
“For too long, leaseholders have been trapped in a system that is unfair, outdated and stacked against them. Thousands of residents across Hertsmere live in leasehold homes and have faced rising ground rents, complex contracts and a lack of real control over their own properties.
“Capping ground rents is a clear cost of living measure that will make a real difference to household finances, but it is also about fairness. This Labour Government is taking decisive action to dismantle a feudal system that should never have survived into the modern housing market.”
Under the proposals, ground rents will be capped at £250 a year, before reducing to a peppercorn level after 40 years. New leasehold flats will be banned altogether, strengthening home ownership and preventing future generations from being locked into exploitative arrangements.
The reforms will also unlock stalled home sales, where leaseholders have found themselves unable to move because mortgage lenders are unwilling to lend on properties with onerous ground rent terms.
Forfeiture will also be abolished, ending the practice where leaseholders can lose their home and the equity they have built up over relatively small debts. A new enforcement regime will rebalance the relationship between landlords and leaseholders, making the system fairer and more transparent.
Alongside this, the Government will introduce a simpler process for existing leaseholders to convert to commonhold, giving residents a genuine stake in the ownership of their buildings and greater control over how they are managed and how service charges are set.
Last year alone, leaseholders across England paid more than £600 million in ground rents. By tackling these costs directly, Labour’s reforms will help families keep more of their hard-earned money and restore confidence in home ownership.
These changes build on wider housing reforms already underway, including stronger protections for renters and increased transparency around service charges, as part of the Labour Government’s commitment to improving fairness, stability and affordability across the housing system.