Leasehold and Freehold Reform Act 2024

Overview of the Act

Reproduced verbatim from the Explanatory Notes published with the Act on legislation.gov.uk (Crown Copyright, Open Government Licence v3.0). Explanatory Notes are prepared by the responsible government department and are not part of the Act.

The Leasehold and Freehold Reform Act 2024 is the second part of a legislative package to reform English and Welsh property law. It follows on from the Leasehold Reform (Ground Rent) Act 2022, which put an end to ground rents for most new, qualifying long residential leasehold properties in England and Wales.

The Act makes long-term changes to homeownership for millions of leaseholders and homeowners on managed estates in England and Wales. The main elements of the Act are:

Empowering homeowners: Ban the sale of new leasehold houses so that - other than in exceptional circumstances - every new house in England and Wales is freehold from the outset. Making it cheaper and easier for existing leaseholders in houses and flats to extend their lease or buy their freehold. Increasing the standard lease extension term from 90 years to 990 years for both houses and flats, with ground rent reduced to a peppercorn. Removing the requirement for a new leaseholder to have owned their house for two years before they can extend their lease or buy their freehold and for flats before they can extend their lease. Increasing the 25 per cent ‘non-residential’ limit preventing leaseholders in buildings with a mixture of homes and other uses such as shops and offices, from buying their freehold or taking over management of their buildings - to allow leaseholders in buildings with up to 50 per cent non-residential floorspace to buy their freehold or take over its management.