As Steve Norris notes in his recent comment article, the property industry has acknowledged that leasehold has genuine problems and many have taken steps to change that.
It is right that government takes appropriate action too, and rather than dismantle the current system entirely, reforms and reinvigorates leasehold in a way that works for consumers.
When it works well, leasehold allows people to live together in multiple ownership developments and important responsibilities to be fulfilled by competent professionals. For this reason, we caution against reform that would make leasehold redundant and seeks to promote commonhold as the only alternative to the problems we face today.
Commonhold should be strengthened, but government must recognise that it places onerous responsibilities on officers of resident management companies, from enforcing covenants to ensuring fire safety. Resident management can be very positive, but is not a panacea.
Many consumers want more involvement and control in decisions about their home, greater transparency about what happens to their money and stronger rights of redress when things go wrong.
We believe much of this can be provided through bold and ambitious reform of the property management sector. I welcome the government’s proposals to introduce mandatory minimum standards, a regulator with teeth and clout, and requirements for professional qualifications.
The industry will welcome the right kind of reform and regulation – that which strips out rogue landlords, poor agents and incentivises good practice and innovation. Operators worth their salt are already self-regulating and this should now be made universal.
With the government bolstering regulation across the residential sector, the message is clear: in the housing market, the consumer has to come first. We can create a leasehold system that works for long-term, responsible investors, while serving consumers far better than it does today.
Nigel Howell, chief executive of FirstPort