Mayor of London pledges 999 year leases for new shared ownership homes

The Mayor of London, Sadiq Khan, has pledged to introduce reforms aimed at selling shared ownership homes delivered as part of his new £4bn Affordable Homes Programme on standard 999 year lease terms.

The plans, outlined in a letter to City Hall housing partners by Deputy Mayor for Housing Tom Copley, aim to protect leaseholders through the adoption of longer leases from the outset, without having to incur additional costs pursuing a lease extension at a later date to preserve the value of the leasehold interest.

The value of leasehold properties tend to depreciate quite drastically once there are 80 or less years left to run on the term of the lease. They also become more difficult to mortgage. With shorter leases, the point at which this happens is reached sooner, forcing leaseholders to commence a costly lease extension process to secure the value of their property.

The Mayor is keen to for London to lead by example and to set a benchmark for higher standards for leaseholders across the United Kingdom. Mr Khan is also using this pledge as a springboard to encourage developers to ensure that other homes they build are offered on a similar long lease basis wherever possible.

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For further information, please contact Philip Mundy