Social Housing Speed Read – Housing Update Following the King’s Speech on 7 November 2023

Though it has drawn a lot of criticism for missing the opportunity to talk about social housing, here are some of the key reforms we can expect to come in the industry.

Key Housing Updates

Introduction of a Leasehold and Freehold Bill

There was a commitment in the King’s Speech to make it cheaper and easier for homeowners to buy the leasehold of a property through the Leasehold and Freehold Bill. The aim of this is to empower leaseholders, making it easier for them to buy the freehold of a property or to extend their leasehold in England and Wales.

The key introductions that are likely to come with this Bill are as follows:

• New houses in England and Wales will be freehold and new-build leasehold properties will be phased out except for in extenuating circumstances.
• The Government will bring an end to “punitive service charges” and attempt to reduce insurance premiums for leaseholders in buildings with fire safety issues. It will require transparency over services charges by requiring costs to be in a “standardised comparable format” so they can be better challenged if unreasonable.
• The Bill will expand on the Building Safety Act 2022, ensuring freeholders and developers are unable to escape their liabilities to fund building remediation work.
• Ground rents will be capped at a “peppercorn” apportionment of a property’s value, bringing in line the protections for existing leases and new leases.
• Lease extensions will be increased from 90 years to 990 years for both flats and houses.
• The 25% ‘non-residential’ limit will be increased, preventing leaseholders in buildings with a mixture of homes and other uses such as shops and offices, from buying their freehold or taking over management of their buildings.
• Changes to ownership requirements for leaseholders, such as the requirement to own a property for two years before they can benefit from these changes.

These proposed changes will likely be important for not-for-profit housing associations whose financial and operational procedures may be affected.

Renters (Reform) Bill

In October 2023, the Government revealed it will not introduce the abolishment of Section 21  ‘no-fault’ evictions until stronger possession grounds and new court process is in place, this point was further confirmed in the briefing notes for the King’s Speech.

Although no new information was provided on the Renters (Reform) Bill in the King’s Speech, a pledge was given to deliver a “fairer deal for renters and landlords, by outlawing no-fault evictions and enabling landlords to evict anti-social tenants faster”.

For further information on the Renters (Reform) Bill and what this could mean for the social housing sector, please see our previous Speed Reads The Renters (Reform) Bill takes its first legislative steps and Renters (Reform) Bill: What does it mean for social housing providers?

Anti-Social Behaviour

The King’s Speech also included a statement that “anti-social behaviour isn’t inevitable, and it isn’t a minor crime”, before announcing two immediate bans to help tackle this issue.

Firstly, as of 8 November 2023, possession of Nitrous Oxide was made illegal. Secondly, XL Bully dogs will be banned by the end of the year under the Dangerous Dogs Act 1991. An XL Bully is defined as a “large dog with a muscular body and blocky head, suggesting great strength and power for its size. Powerfully built individual”. If a dog meets the minimum height measurements and has a substantial amount of the physical characteristics set out in the Official Definition, it may be within the scope of the ban even if it was not sold as an XL Bully.

Summary

Even though the majority of the housing content in the King’s Speech was already known to us, it has reiterated that the current housing law is still a priority for reform and amendment. It is crucial that housing providers are vigilant to how such long-awaited reforms can affect them and their business when they do eventually materialise.

If you have any questions about these prospective changes or if you would like any advice on how to best prepare your business, please do not hesitate to contact one of our expert Social Housing lawyers.