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Leasehold and Freehold Reform Act

Leasehold and Freehold Reform Act

This week marks a historic moment for homeowners in England and Wales as the Leasehold and Freehold Reform Act has officially become law. With Royal Assent granted, millions of homeowners are now empowered with greater rights, protections, and the ability to take control of their homes like never before. This legislation represents the most significant overhaul of the leasehold system in a generation, aiming to make homeownership fairer, more transparent, and more secure.

Key Reforms Introduced by the Act

Cheaper and Easier Lease Extensions and Freehold Purchases

Homeowners can now extend their lease or purchase their freehold at a reduced cost, making it more affordable to secure their property rights. The standard lease extension term has been increased to 990 years for both houses and flats, up from the previous 50 years for houses and 90 years for flats. This means that leaseholders can now enjoy nearly a millennium of ownership without worrying about future lease extensions.

Greater Transparency in Service Charges

One of the critical reforms is the requirement for freeholders and managing agents to issue service charge bills in a standardized format.
This change ensures that leaseholders have a clearer understanding of what they are paying for and can more easily scrutinize and challenge
any discrepancies.

Leasehold and Freehold Reform Act

Easier Building Management Takeover

The Act simplifies the process for leaseholders to take over the management of their building. This allows them to appoint a managing agent of their choice, potentially leading to better management practices and more satisfactory living conditions.

Reduced Costs for Exercising Enfranchisement Rights

Leaseholders will no longer have to cover their freeholder’s costs when making a claim to extend their lease or purchase their freehold. This reduction in costs removes a significant financial barrier, making it easier for leaseholders to exercise their rights.

Extended Access to Redress Schemes

The government has extended access to redress schemes, enabling leaseholders to challenge poor practices more effectively. Freeholders who manage their buildings directly will now be required to belong to a redress scheme, offering leaseholders a formal route to address grievances.

Streamlined Buying and Selling Processes

The Act introduces a maximum time and fee for providing home buying and selling information, making the process of buying or selling a leasehold property quicker and more straightforward.

Rights of Redress on Private and Mixed Tenure Estates

Homeowners on private and mixed tenure estates will benefit from comprehensive rights of redress. They will receive more detailed information about the charges they pay and have the ability to challenge the reasonableness of these charges.

Additional Benefits for Leaseholders

Scrapping Freeholders’ Legal Cost Presumption

The Act removes the presumption that leaseholders must pay their freeholder’s legal costs when challenging service charges. This change eliminates a significant deterrent and encourages leaseholders to challenge unfair practices without the fear of excessive legal fees.

Banning Opaque Insurance Commissions

Opaque and excessive buildings insurance commissions for freeholders and managing agents are now banned. Instead, transparent and fair handling fees will be implemented, ensuring leaseholders are not overcharged for their buildings insurance.

Banning the Sale of New Leasehold Houses

Except in exceptional circumstances, the sale of new leasehold houses will be banned. This ensures that every new house in England and Wales will be freehold from the outset, providing homeowners with full ownership rights.

Removing Ownership Duration Requirements

Previously, new leaseholders had to own their house or flat for two years before they could extend their lease or buy their freehold. The Act removes this requirement, allowing new leaseholders to take immediate action to secure their property rights.


The Leasehold and Freehold Reform Act marks a transformative step forward for homeowners in England and Wales. By addressing longstanding issues in the leasehold system, the Act provides leaseholders with greater security, transparency, and control over their homes. These reforms not only enhance the rights of current homeowners but also set a new standard for future homeownership, promoting fairness and equity in the housing market.

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