Leasehold and Freehold Reform Act 2024 — What It Means for You
The Leasehold and Freehold Reform Act 2024 received Royal Assent on 24 May 2024 after years of campaigning by leaseholder groups. It is the most significant piece of leasehold legislation in a generation — but many of its provisions are not yet in force.
Here is what the Act changes, what it means for flat owners, and what you should watch for as secondary legislation rolls out.
The Headline Changes
Cheaper lease extensions
The Act removes marriage value from the lease extension calculation. Marriage value is the increase in property value that results from merging the lease and freehold interests — and historically it made extending a short lease extremely expensive.
Under the new rules, leaseholders can extend their lease by 990 years at a peppercorn (zero) ground rent. The premium calculation will be based on a simpler formula set by the government.
Ban on new leasehold houses
The Act prohibits the granting of new long residential leases on houses, with limited exceptions. This closes a loophole that some developers exploited to sell houses as leasehold and retain ground rent income.
Service charge transparency
Freeholders and managing agents will be required to provide standardised service charge accounts and give leaseholders more information about building insurance commissions. The goal is to make it harder to hide excessive fees.
Right to manage improvements
The Act makes it easier for leaseholders to take over management of their building through the Right to Manage (RTM) process, including by removing the requirement that the building must have at least two-thirds residential use.
Regulation of managing agents
A new regulatory regime for property managing agents is anticipated, though the detail will depend on secondary legislation.
What Is Not Yet in Force
Royal Assent means the Act is on the statute book, but most of its provisions need commencement orders — statutory instruments that switch individual sections on. As of early 2025, many key provisions including the new lease extension premium calculation are still awaiting commencement.
The government has said it will consult on the detailed regulations before bringing them into force. This means there could be further changes to the specifics of the premium calculation, the service charge format, and the managing agent regime.
What Leaseholders Should Do Now
If your lease is getting short
The new premium calculation is expected to make extensions cheaper — but it is not yet in force. If your lease is below 80 years, you face a difficult timing decision: extend now under the current (more expensive) rules, or wait for the new rules and risk the lease getting shorter in the meantime.
There is no single right answer. Speak to a specialist leasehold solicitor who can advise based on your specific circumstances.
If you are buying a leasehold flat
The reforms do not change the fundamental structure of leasehold. You will still pay service charges, still need to check the lease length, and still rely on a freeholder or managing agent to maintain the building. The Act improves the framework, but due diligence is still essential.
If you want to push for implementation
Write to your MP. The pace of commencement depends on political will. You can check whether your MP supported the Act by looking up their voting record on Zepely's MP tracker. MPs who voted for the legislation are more likely to push for fast implementation if they hear from constituents.
How Parliament Voted
The Leasehold and Freehold Reform Bill passed with broad cross-party support, but the voting pattern varied by party and by individual MP. Some MPs who represent constituencies with large property development interests voted differently from their party colleagues.
Zepely tracks this specific division alongside nine other leasehold-related votes. Visit the party analysis page to see how each party voted overall, or enter your postcode on the MP page to see your own representative's record.
Looking Ahead
The Act is a framework. The detail — and the real impact on leaseholders' wallets — depends on the secondary legislation still to come. Key things to watch:
- Commencement dates for the new lease extension premium calculation
- Consultation outcomes on service charge standardisation
- Managing agent regulation timelines and scope
- Whether the government extends protections to existing ground rent clauses (currently not covered by the 2022 Act for pre-existing leases)
Leasehold reform is a process, not an event. Staying informed and engaged is the best way to make sure the promises in the Act translate into real change.