Committee publication · Correspondence · 25 March 2026
Letter from ExtraCare to the Chair dated 18 March 2026 concerning the draft Commonhold and Leasehold Reform Bill
From: Housing, Communities and Local Government Committee
Inquiry: Pre-legislative scrutiny of the draft Commonhold and Leasehold Reform Bill
Summary
ExtraCare Charitable Trust, a major operator of housing-with-care schemes for older people, warns the Housing, Communities and Local Government Committee that commonhold tenure is incompatible with its business model. The organisation has suspended £60 million in expansion plans and urges the committee to recommend including a 'Retirement Occupancy Lease' (ROL) framework in the Commonhold and Leasehold Reform Bill to preserve the IRC sector's viability.
Key findings
- ExtraCare operates 18 Integrated Retirement Communities housing 4,300 customers in 3,600 apartments across the Midlands and South, with a charitable care-subsidy model costing £2.5m annually.
- The charity's 'guaranteed buy-back scheme' allows affordable initial pricing by recapturing property value for refurbishment and care subsidies; commonhold's prohibition on resale restrictions makes this model legally impossible.
- Commonhold places unsustainable financial and operational burden on residents (average age 83) who would assume full control of complex service-intensive operations (£17,000 per unit annually vs. £1,720 median service charge elsewhere).
- Removal of leasehold tenure would make retirement community housing unaffordable for most customers and threaten affordable alternatives to high-acuity care homes.
- ExtraCare and ARCO propose a 'Retirement Occupancy Lease' modelled on New Zealand's successful license-to-occupy system, implementable within 12 months; the draft Bill omits this recommendation.
Tone
CriticalTopics
Key actors
ExtraCare Charitable Trust, Mick Laverty, Florence Eshalomi MP, Housing, Communities and Local Government Committee, ARCO (Association of Retirement Community Operators), Department of Levelling Up, Housing and Communities
Notable line
“… without a workable tenure model for IRC operators like ExtraCare, our plans to expand our portfolio of housing-with-care schemes will be put on hold indefinitely.”
Key Quotes
“… without a workable tenure model for IRC operators like ExtraCare, our plans to expand our portfolio of housing-with-care schemes will be put on hold indefinitely.”
“… the charity has already taken the difficult decision to suspend plans to develop 138 additional properties by extending two of our retirement villages - an investment of approximately £60 million - despite having the …”
“… commonhold is legally incompatible with our model of selling back apartments to us as the operator.”
“On average, our budgeted income and expenditure per leasehold housing-with-care unit is approximately £17,000 – 10 times the median service charge of £1,720”
“… we believe that the costs of buying into and living in a retirement community would become simply unaffordable to the vast majority of our customers.”
“ARCO and its members are proposing the introduction of a 'Retirement Occupancy Lease' (ROL) for the IRC sector. This would reproduce key features of the New Zealand contract model, but could be implemented within 12 months.”
“We were disappointed to see that the government did not respond to this recommendation in the draft Bill that was published.”
Source · parliament.uk record ↗