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Leasehold and Freehold Reform Act 2024

14 October 2024

The Leasehold and Freehold Reform Act 2024 (“the Act”) will make it easier and cheaper for leaseholders to buy their freehold, increase standard lease extension terms to 990 years for houses and flats, and provide greater transparency over service charges. The Act will also remove barriers for leaseholders to challenge their landlords’ unreasonable charges at Tribunal 

It will further ban the sale of new leasehold houses other than in exceptional circumstances, end excessive buildings insurance commissions for freeholders and managing agents, and scrap the requirement for a new leaseholder to have owned their house or flat for two years before they can buy or extend their lease 

The new powers also grant freehold homeowners on private and mixed tenure estates the same rights of redress as leaseholders, and equivalent rights to transparency over their estate charges, and help more leaseholders take over the management of their property if they want to. Leaseholders in some buildings are barred from taking over the management of the site or buying its freehold if more than 25% of its floor space is commercial – such as shops or offices on the ground floor. But this limit will now be increased to 50% to enable more homeowners to access Right to Manage or the right to a collective enfranchisement 

When will it apply?  

The Act became law on 24/05/24 under the previous government. However, the main provisions of the Act will not have effect until secondary legislation has been passed. The new Labour government has pledged to introduce the reforms as soon as possible. Further consultation may be required before this happens so we expect the changes could take several months before they are in force.  In the meantime the existing leasehold laws will continue to apply.   

What’s in the Act?  

The Act – strengthens existing, and introduces new, consumer rights for homeowners by:  

The Act will further benefit leaseholders by:  

A new Leasehold and Commonhold Reform Bill  

In the King’s Speech on 17th July 2024, the Labour government promised draft legislation in 2024/25 to bring the feudal system of leasehold to an end and to reinvigorate commonhold.   

The draft legislation will include:  

Further information:

LEASE is governed by a board, appointed as individuals by the Secretary of State for the Ministry of Housing, Communities & Local Government.