The Government is to relent on forcing landlords of leasehold properties to have to be a member of a redress scheme. This is despite increasing pressure from conveyancers looking for a reform of leasehold legislation.
There have been calls from The Conveyancing Association for existing and incoming leaseholders to be made to join a redress system with consumer rights, similar to one of the three existing property ombudsman schemes.
Baroness Hayter of Kentish Town brought up the issue of redress schemes for landlords of leasehold properties during a Department for Communities and Local Government debate last week.
Hayter enquired if the Government was thinking of extending the requirements of the Consumers, Estate Agents and Redress Act 2007 and the Enterprise and Regulatory Reform Act 2013, in order to require landlords of leasehold properties to be permitted to belong to a redress scheme.
However, minister Lord Bourne noted that the Government, ‘is not persuaded that more burdensome approaches to regulate landlords would be effective.’
Mr Bourne said leaseholders in dispute with a landlord could apply to the first-tier tribunal (property chamber) in England and the Leasehold Valuation Tribunal in Wales to obtain redress.
He continued by saying, ‘the government is extending leaseholders’ access to redress by including provisions in the Housing and Planning Act 2016 that will address an irregularity concerning the inability of courts and tribunals to restrict recovery of a landlord’s legal costs from leaseholders as administrative charges, where they consider a restriction on recovery to be just and equitable. The Government plans to introduce related secondary legislation by summer 2017.’