The problem(s) with leasehold

Originally published on April 13 on  my blog for Inside Housing.

Question: When is a home owner not really a home owner? Answer: When they are a leaseholder.

Leaseholders have the responsibilities of being an owner without having all of the rights. They own the bricks and mortar* of the homes they are living in – but only for the length of their lease – and they do not own the land it is built on.

They pay a mortgage but they also pay ground rent to the freeholder and a service charge for maintenance carried out by companies over whom they may have no control. They may see themselves as owners but in the eyes of the law they are tenants.

The issue has come to a head recently with the scandal of developers selling leasehold new houses and then selling on the freehold for a profit. Unwitting buyers have found themselves facing bills for ground rent that double every 10 years and an escalating bill for buying the freehold.

Read the rest of this entry »


Manifestly without reason

Originally published on November 8 on my blog for Inside Housing

On a day when it was badly needed the judges of the Supreme Court obliged with some good news.

Yes, it was mixed with bad news in the judgement on the bedroom tax, as two claimants won their case and others were refused, but it was still a welcome vindication of the case put forward by the Carmichaels, the Rutherfords and their lawyers. In the words of the judgement, the decisions on their housing benefit were ‘manifestly without reason’.

Read the rest of this entry »


The Housing Bill: The final lap

Originally published on April 29 on Inside Edge 2, my blog for Inside Housing

The worst excuse for a Bill that I can remember in 25 years of writing about housing limps back to the House of Commons next week.

The Housing and Planning Bill’s tail is not quite between its legs as all the key elements are still there and the Commons will reverse some changes. But it’s been gutted in the Lords, with two more defeats for the government on Wednesday, and this morning (Friday) it’s the subject of withering criticism by the all-party Public Accounts Committee.

Read the rest of this entry »


The Housing Bill: the better part of valour

Originally posted on April 19 on Inside Edge 2, my blog for Inside Housing

It was another day, another session of watering down the Housing and Planning Bill in the Lords. Peers reached sections of the Bill including Pay to Stay and security of tenure in the latest Report stage debate on Monday.

On Pay to Stay for ‘high income’ council tenants, they inflicted three more defeats on the government and they also forced some interesting clarifications of the detail out of ministers. As the Bill now stands, local authorities will have discretion about whether to apply Pay to Stay, the thresholds will be increased to £40,000 outside London and £50,000 in London, and the taper for higher rents will be 10p.

Obviously it remains to be seen how much of this the government will look to reverse in the Commons, perhaps citing financial privilege because the money raised by the policy goes back to the Treasury.

The government version of the policy – set out in an email to peers an hour before the debate – is that it will be compulsory for councils, the thresholds will be £31,000 and £40,000 and the taper will be 20p. That means tenants would pay an extra £200 a year in rent for each £1,000 they earn above the thresholds. (It’s not clear to me why the out-of-London threshold has been increased from the previous £30,000).

Read the rest of this entry »


Checking the bill

Originally posted on February 10 on Inside Edge 2, my blog for Inside Housing 

Start with a fundamental change to the funding mechanism for the right to buy, stir in more changes to key elements of the Housing and Planning Bill, then add criticism of the lack of detail and you have a recipe that shoud give ministers indigestion.

The report of the all-party Communities and Local Government Committee does support both the extension of the right to buy to housing association tenants and the voluntary deal between the government and the NHF is ‘the best way forward’.

But that’s as good as it gets for ministers from a committee that has a Labour chair but a Tory majority. Here is the headline recommendation:

‘The Government proposes to fund the right to buy discounts for housing association tenants with the proceeds from the sale of high value council homes. However we believe that public policy should usually be funded by central Government, rather than through a levy on local authorities.’

This would undermine one of the central elements of the Bill and the government’s method of paying for right to buy discounts and the promised replacement homes. And the MPs are not finished.

Read the rest of this entry »


Rent control moves closer to home

Whether you’re for or against measures to control private sector rents, it’s going to be worth watching closely what happens to new legislation in Ireland.

After a long row between the Irish coalition partners, the government has finally agreed a package of measures designed to give ‘rent certainty’ to tenants until supply increases. The package includes:

  • For the next four years, landlords will only be allowed to increase their rents once every 24 months rather than 12 months as at present
  • Landlords will have to give 90 days notice of any increase (up from 28)
  • Landlords will have to provide evidence that any future increases are in line with the local market rate and inform tenants of their legal right to challenge them
  • Tenants will have stronger protection against unscrupulous landlords who falsely declare they need to sell the home or move in a family member: landlords will have to sign a statutory declaration and face fines if it is invalid
  • Landlords who house tenants on social security will get 100% mortgage tax relief against their rent (up from 75%).

Note that ‘rent certainty’ is not the same thing as rent control. What’s interesting about the package from this side of the Irish Sea is that it anticipates – and goes beyond – all of the points raised in the growing debate on rent regulation here. The Scottish Government is dipping its toe in the water with a Bill that will allow local rent control in rent pressure areas while Labour will call for new powers to freeze rents in London if Sadiq Khan wins next year’s mayoral election.

Read the rest of this entry »


Scotland goes its own way on private renting

Originally posted on September 2 on Inside Edge 2, my blog for Inside Housing

Rent control and increased security of tenure are back on the government agenda for the private rented sector for the first time in 30 years.

I am of course talking about the Scottish Government, which yesterday confirmed plans for a Private Tenancies Bill as part of its Programme for Scotland 2015/16. The Bill will ‘provide more predictable rents and protection for tenants against excessive rent increases, including the ability to introduce local rent controls for rent pressure areas’.

And it will introduce a Scottish Private Rented Tenancy to replace the current assured system and remove the ‘no-fault’ ground for repossession. That means the landlord will no longer be able to ask a tenant to leave just because the fixed term has ended but there will be ‘comprehensive and robust grounds for repossession that will allow landlords to regain possession in specified circumstances’.

Read the rest of this entry »