My Lords, I like this group of amendments. We have just had a group of amendments in which we talked a lot about protecting species’ habitats. I am an enthusiast of the hedgehog as much as anyone else, but I am worried that the Bill neglects human habitats: housing. I am really glad that we are going to focus in on that.
We heard an imaginative, problem-solving amendment from the noble Lord, Lord Best, who brilliantly motivated homes for older citizens, something that I would like to see developed. I have added my name to Amendments 215 and 218.
I am grateful to the noble Lords, Lord Lansley and Lord Young of Cookham, and the noble Baroness, Lady Hayman of Ullock, for focusing on housing supply. I made that the focus of my Second Reading speech and I continue to raise the issue, but it has been explained and motivated so well so far that I will confine myself to Amendment 210 in my name. However, unless there is some movement from the Government on tackling the blocks to building more homes and increasing the stultifying and sluggish housing supply, I will happily support the noble Lords and the noble Baroness if they table similar amendments on Report, because this is an issue of great urgency.
Amendment 210 is a modest amendment that deals with how homes are categorised and marketed in local plans. It would ensure that any local plans are honest and transparent about housing data and targets. Housing is usually categorised as either rented or owned, but I suggest that we need a third category that might more honestly reflect reality. If you go into an estate agent’s or look longingly in the window, you look at either rented accommodation or accommodation for sale. If you are lucky enough to buy a home, you assume that it is fully yours, but the sad reality is that the one in four so-called home owners who buy a leasehold property—nearly 5 million homes are in this category—are not home owners at all.
People should know what that means. When they go to an estate agent, we need to ensure that there is less mis-selling and that the estate agent advertises in its window “homes to lease”, rather than “homes to sell”, when it comes to leaseholders. This is important, because a lot of the Government’s rhetoric on housing and levelling up is intended to motivate an increase in the number of home owners. Arguably, leaseholders should not be counted in those figures.
I will give a few definitions and a bit of history. The reality of what the nature of leasehold really means came as rather a shock to many of us when it was exposed by the post-Grenfell building safety crisis. It has become increasingly apparent, at least to leaseholders, that we are not home owners—I declare an interest as a leaseholder. We realised that what we had purchased was a time-limited licence to occupy a concrete shell, of which the leaseholder does not own a brick, even after the mortgage has been redeemed.
In contemporary debates on this issue—of which there have been many recently, in both Houses—leasehold is often described as feudal serfdom. When I heard that, I thought it was just a bit of political hyperbole, but in fact leasehold tenure harks back to an age when land was correlated with power; and even in 2023, leasehold is indeed still firmly rooted in a sense of serfdom and manorialism. The medieval aristocracy enjoyed perpetual land ownership by allowing serfs to occupy premises on their land in return for labour and, later, in exchange for financial contributions.
As if to emphasise how much of that ancient history continued well after the end of feudalism, for many years leaseholders did not have the franchise. Why? Because the property qualification that was required in order to have the vote meant that you had to own your own property before you could choose who governed you.
Because leaseholders did not count as owning their own property, they were not given the vote. When the democratic struggles succeeded in abolishing this egregious property requirement for voting, there was, unfortunately, no abolition of leasehold—but not for the want of trying. Even in 1884, Lord Randolph Churchill decried leasehold for empowering landowners to
“exercise the most despotic power over every individual who resides on his property”.
Indeed, between 1884 and 1929, there were at least 18 attempts to legislate against leasehold. It seems ridiculous that this has been going on for so long. But here we are, in 2023, with seeming cross-party unanimity, at last, on abolishing leasehold altogether.
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Lisa Nandy, the shadow Levelling Up Secretary, has made Labour’s position clear. Labour will abolish leasehold, and, on this this at least, agrees with the Housing Secretary Michael Gove, and many Cross-Benchers, Bishops, Liberal Democrats and everybody in this Committee who seems to have been passionate and vociferous on the issue. So, you might think, why am I going on? Maybe this amendment is totally redundant. However, until I see it in the King’s Speech, I remain sceptical. At least, I want to ensure that we are honest before then about what leasehold means. This Bill aims to increase home ownership and says that it is an important part of levelling up. I want to ensure that leasehold properties are not counted under this category of home ownership.
I would like to welcome a new grass-roots campaign organisation, Commonhold Now, set up by the tireless leasehold activists Harry Scoffin and Karolina Zoltaniecka. It is calling for a mass shift to commonhold, a system widely used in Scotland, Canada and Australia. Interestingly, the organisation is committed what it calls “real homeownership”. It is focused on what makes ownership real: autonomy and control. People aspire to buy properties precisely so that they can have greater freedom, autonomy and control. They feel that that it will be different to being dependent on a landlord as a renter. It is very disillusioning to then discover that leasehold actually robs you of that control.
I learned that the hard way shortly after I became a first-time buyer over 20 years ago, partly to fulfil my father’s rather forlorn deathbed request that I settle down and take some responsibility. Some local footballing kids cracked my new flat’s window, so I decided to take my father’s advice and acted responsibly to replace the window. The response of my freeholder, Haringey Council, was to fine me for interfering with its property without permission.
My father, who worked in the construction business, also warned me that I should always get lots of comparative quotes from a range of contractors before getting any work done. But, as a local authority leaseholder, I have no right to do that. It is the council which enters into long-term agreements with contractors, who do not even have to tender for each project. Those of us who have to pay for the works have no right to decide on their scope, timing or even necessity. Being a leaseholder makes it almost impossible to budget, as you have no control over and or even cannot find out
the extent of forthcoming costs because you do not control spending. For private sector leaseholders in the midst of the energy crisis, it is even worse. One article on this was titled:
“I am writing the cheque yet I have no control over what is being spent”.
Even legislation designed in this House to protect leaseholders by making homes safer has been turned into yet another mechanism for extracting cash and diminishing the choice and autonomy of many private leaseholders. One shocking example, in light of the fire safety legislation we passed, is a block of leaseholders who were told they would collectively be charged £500,000 to replace wooden terraces with special composite materials. Those leaseholders, at their own expense, consulted independent experts, who told them that the terraces did not need replacing; they were not a fire risk or in breach of any new legislation—and, anyway, paving stones were a lot cheaper and would do just as well. In other words, being a leaseholder means that you do not own your own home and this Bill needs to reflect that.
I of course do not want my amendment or any critique of leasehold to become an excuse for not building new homes, such as blocks of flats. As I have mentioned, the solution to the housing crisis, in terms both of rental and buying, and the solution to the affordability issue, is to focus on increasing supply with urgency. In a recent article in the Financial Times, John Burn-Murdoch made a plea for apartment living in high-density, high-rise blocks. I am all for that, but such developments are inevitably leasehold at the present time. Focusing new housebuilding and urban development on blocks of leasehold flats could lead to creating more second-class home owners, locked and entrapped in the costly and miserable limbo of leasehold. Even much of the retirement accommodation spoken of by the noble Lord, Lord Best, is at present leasehold and there are problems of exorbitant service charges.
We need to make sure that those who are desperate to get their foot on the first rung of the property ladder are not exploited by believing that leasehold means that they now own and control their homes. At the very least, any new-build homes that offer leasehold, rather than shared freehold or commonhold, must be honestly reflected and labelled in government data. They should not be counted as home ownership or cited as proof of fulfilling levelling-up targets. So, until leasehold is abolished, let us call it for what it is—and it is not home ownership.