Leasehold and Freehold Reform Act provisions take effect
Long-awaited reforms removing ground rents on most new long leases and cutting lease extension costs began to come into force this spring.
By Money Guide editorial team
Published:
Provisions of the Leasehold and Freehold Reform Act 2024 began to take effect this spring, including the abolition of ground rents on most new long residential leases, simplification of the lease extension process, and reforms to the way enfranchisement (buying the freehold) is priced.
Existing leaseholders have for several years been entitled to extend their lease by 990 years on a peppercorn ground rent, with detailed valuation rules now reformed to remove 'marriage value' from the calculation in many cases — meaningfully cheaper for leases under 80 years.
Service charge transparency rules require landlords to provide clearer breakdowns and respond to challenges through the First-tier Tribunal. The cap on landlord-recoverable legal costs in service charge disputes is being tightened.
Reform of the broader leasehold tenure (towards a commonhold model used in much of Europe) remains under consultation and is not in force.