Leasehold: Valuation
The question
To ask the Secretary of State for Housing, Communities and Local Government, when she plans to consult on the valuation rates used to calculate the cost of enfranchisement premiums.
Answered by Matthew Pennycook
The 2024 Leasehold and Freehold Reform Act sets the method for calculating the price of a statutory lease extension or freehold acquisition, known as the valuation process.
The Bill removes the requirement for marriage value to be paid, caps the treatment of ground rents in the valuation calculation at 0.1% of the freehold value, and allows government to prescribe the rates used to calculate the enfranchisement premium.
Valuation rates will be set by the Secretary of State in secondary legislation, and we have made clear we intend to consult before determining what the rates should be.
Last week the High Court heard challenges to some of the 2024 Act enfranchisement reforms. Leaseholders should be assured that the government is robustly defending those challenges. Following the outcome of the hearing, we will provide further update on the rates consultation.
Once the consultation goes live, we want to hear views from a broad spectrum of stakeholders before making a decision, and we invite all who have an interest to feed these in.
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