The Leasehold and Freehold Reform Bill (the Bill) follows the Leasehold Reform (Ground Rent) Act 2022 (the Act) which B P Collins’ property team have already commented on in June 2022 after it came into force and again in April 2023 following the retirement leasehold element of the Act coming into force.   

The Bill seeks to provide longer term certainty to leasehold owners and to equip leaseholders with more rights coupled with lower costs when seeking to purchase their freehold or extend their lease.

Proposed changes

The Bill proposes that the standard lease extension term is increased from 90 years to 990 years for both leasehold flats and houses and that ground rent for both is reduced to a peppercorn under a lease extension.

The Bill also seeks to abolish the require for leaseholders to have owned their house for more than 2 years before being able to extend their lease or buy the freehold and for flat owners to have been in possession for more than 2 years before being able to extend their lease.

The Bill also wants to enable leaseholders in buildings with up to 50 per cent non-residential floorspace to buy their freehold or take over its management, an increase from the current ‘residential use’ cap of 25%.

Other changes proposed to help make being a leaseholder easier and more accessible is that the presumption that the leaseholder will pay the freeholders legal fees when challenging poor practice will be rebutted and a standardised service charge demand form will be introduced to provide more transparency over service fees to allow leaseholders to identify more easily if any fees need to be challenged if they consider them to be unreasonable.

Leasehold houses – will they be banned?

As part of the King’s speech, delivered on 7 November 2023,  the Bill was introduced and an area the Bill was supposed to cover was the ban on the slae of new leasehold houses. However, the Bill made no such mention during it’s first reading. Whilst no formal comment has been made on this ‘omission’ some news outlets are purposed that the ban on leasehold houses will be introduced into the Bill at a later stage in its passage to the statute books. 

Next steps

The Bill had its First Reading in the House of Commons on 27 November 2023, it will go through a Second Reading on 11 December 2023, Michael Gove the Housing Secretary hopes the Bill will be in force by the time the next General Election happens, anticipated to occur in 2024 and he has commented that “it has widespread support in the House of Commons and the House of Lords.” The Bill will be monitored to see if any additions or omissions are made at it’s next reading and to see if a firmer timeline for its royal assent will be made.

For further information on how this could affect a transaction please contact the property team at or call 01753 889995.

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