The Government has recently announced that millions of leaseholders will be given the right to extend their lease by a maximum term of 990 years at zero ground rent as part of the biggest reforms to English property law for many years
What are the changes?
Under the current law, many people face high ground rents and Freeholders can increase the amount of ground rent with little or no benefit seen to the owners of the property who hold the lease. It can also create problems and lead to increased costs when buying or selling the property.
Leaseholders of houses can only currently extend their lease once for 50 years with ground rent. This compares to leaseholders of flats who can extend as often as they wish at a zero ‘peppercorn’ ground rent for 90 years. These changes mean both house and flat leaseholders will now be able to extend their lease to a new standard of 990 years with a ground rent at zero.
These changes will mean that any leaseholder who chooses to extend their lease on their home will no longer pay any ground rent to the freeholder.
A cap will also be introduced on ground rent payable when a leaseholder chooses to either extend their lease or become the freeholder. The Government will soon be introducing an online calculator to make it simpler for leaseholders to find out how much it will cost them to buy their freehold or extend their lease.
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On 8th January, Housing Secretary, Robert Jenrick, announced a further extension to the ban on bailiff-enforced evictions for private renters in England which comes into force on 11 January. The current restrictions were due to end on Monday following a month-long ban over the Christmas period. The new extension will be until 21 February and reviewed regularly.
There are exemptions to the regulations which include:
- Illegal occupation
- False statement
- Anti-social behaviour
- Where a property is unoccupied following the death of a tenant
- Extreme rent arrears (equivalent to six months’ rent with any arrears accrued since 23 March discounted)
The UK Government has now approved The Public Health (Coronavirus) (Protection from Eviction) (England) Regulations 2021 and has released updated guidance to reflect a return to a national lockdown and the extension of the ban on bailiff enforcement.
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Consultation is now open on the government's proposals to further strengthen the current rules on smoke alarms and carbon monoxide detectors in both social and private rented accommodation. The proposals include requiring social landlords to ensure at least one smoke alarm is installed on each storey of a building where any rooms are used as living accommodation; requiring carbon monoxide alarms to be fitted alongside the installation of fixed combustion appliances of any fuel type; and requiring private and social landlords to install carbon monoxide alarms in any room used as living accommodation where a fixed combustion appliance is used. The consultation will last until 11 January 2021.
There are 3 main proposals
A requirement for social landlords to install smoke alarms on each storey of a building
Since 2015, private sector landlords have been required to install at least one smoke alarm in rooms used either wholly or partly as living accommodation and ensure that the alarms are in working order at the start of each tenancy under the Smoke and Carbon Monoxide Alarm (England) Regulations 2015. A review of the regulations in 2018 found that they had had “a positive impact on the number of alarms installed” and also suggested the regulations should be expanded to cover both the private and social rented sector. Under the proposals, social landlords will also be required to ensure that there is at least one smoke alarm installed on each storey of a building where there are any rooms used wholly or partly as living accommodation and ensure that the alarms are in proper working order on the first day of each new tenancy.
A requirement for the installation of carbon monoxide alarms at the same time as the installation of a fixed combustion appliances of any fuel type
Since 2015, private sector landlords have been required to install a carbon monoxide alarm in any room which is used wholly or partly as living accommodation and contains a solid-fuel burning appliance. As with smoke alarms, the regulations also require private landlords to ensure the alarms are in working order at the start of each tenancy. Under the proposals, the statutory guidance would be amended so that carbon monoxide alarms must be fitted upon the installation of fixed combustion appliances of any fuel type (excluding gas cookers). These requirements apply to installations in new and existing homes regardless of whether they are private or social rented accommodation or owned.
A requirement for the installation of carbon monoxide alarms in any room with a fixed combustion appliances of any fuel type
In addition to proposing that carbon monoxide alarms be installed at the same time as the installation of fixed combustion appliances, an amendment to the Smoke and Carbon Monoxide Alarm (England) Regulations 2015 is being proposed that would require both private and social landlords to install a carbon monoxide alarm in any room used as living accommodation where there is a fixed combustion appliance of any fuel type (excluding gas cookers). The regulations will not include owner-occupiers, although it is recommended that homeowners install carbon monoxide alarms, too. As with smoke alarms, landlords would be required to ensure alarms are in working order on the first day of each new tenancy.
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First-time buyers interested in new-build homes can apply for the new Help to Buy: Equity Loan scheme.
The new Help to Buy Scheme is now open for business.
Homes England has announced that first-time buyers interested in new-build homes can apply for the new Help to Buy: Equity Loan scheme from Wednesday 16 December 2020.
With a Help to Buy: Equity Loan, the government lends homebuyers up to 20% (40% in London) of the cost of a newly built home. Customers pay a deposit of 5% or more and arrange a mortgage of 25% or more to make up the rest. The equity loan is interest-free for the first five years.
Homebuilders are getting into contract for the new scheme and starting to market their new build homes. Eligible first-time buyers will be able to reserve their homes from mid-December and get the keys to move in from 1 April 2021.
The new Help to Buy: Equity Loan (2021-2023) helps those who need it most, first-time buyers. Help to Buy will keep supporting first-time buyers so that more people are helped to make their first step on the housing ladder.
Help to Buy (2021-2023) has regional price limits, set at 1.5 times the average first-time buyer price in each region in England. This keeps the prices of new homes closer to the average regional first-time buyer property prices, reducing the amount that first-time buyers need to borrow.
Homebuilders selling Help to Buy homes under the new scheme must comply with more stringent conditions that aim to drive quality and consistent building standards.
Help to Buy homebuilders must agree to follow Consumer Code for homebuilders, the New Homes Ombudsman, the Building Safety Charter and fulfil planning permissions and building regulations.
They must also display their Home Builders Federation (HBF) star ratings when they advertise homes and give homebuyers a new home warranty before they complete their purchase.
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We may be in Lockdown 2 but the property market is still open and so are CB Estates. Since last Thursday until at least Wednesday 2 December, England is now under stricter new coronavirus restrictions. It has been called Lockdown 2 and will last for four weeks.
Lockdown 1 in March had a major impact on the housing market and property activity all but stopped overnight. However, the Government has stressed that the property market this time can continue to operate during Lockdown 2, provided Covid safety precautions are taken.
The Government has confirmed that you are allowed to do the following:
Visit estate or letting agents, developer sales offices or show homes
View homes to buy or rent
Prepare a home to move into
Visit a home to prepare it for sale or rent.
Can I move home?
Yes, this is allowed provided everybody follows social distancing procedures and takes precautions, such as using masks and gloves. Removal firms have been allowed to stay open to enable moves to take place
Can I still view properties in person?
Yes, however there will be extra restrictions and you may be asked to view a video of the property first. You must wear a face covering and there will be a restriction on the number of people allowed in the property at any one time. You must not view properties if you are showing symptoms of COVID-19 or are self isolating. You should take care to avoid touching surfaces and the time spent in the property should be kept to a minimum.
Can I put my house on the market?
Yes you can. Agents are allowed to visit properties to carry out a valuation, take photographs and prepare floorplans.
Are Estate Agents allowed to open?
Yes Agents can open, however many are only allowing visitors by appointment and with suitable face coverings.
CB Estates is open for business during Lockdown 2 and we are following COVID-19 safety guidelines to ensure the safety of all our customers. All our available properties have a detailed video walkthrough available so that you are able to 'virtually view' the property. Viewings can take place following social distancing guidelines and taking relevant precautions. We are also available to carry out valuations either virtually or in person.
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