Blog | Valuation | Leasehold & Freehold Reform

Understanding The Key Proposals In This Landmark Bill: The Leasehold And Freehold Reform Bill

The Leasehold and Freehold Reform Bill, which was introduced to Parliament on 27 November 2023 and received Royal Ascent on 24 May 2024, is a significant piece of legislation that aims to reform the Leasehold sector.

The Government first talked about finding ways to make buying a freehold or extending a lease ‘easier, faster, fairer and cheaper’ six years ago.

This landmark Bill proposes a series of changes that could have far-reaching implications for leaseholders, landlords, and the property market as a whole. Here, we delve into the key provisions of the Act, which has become law although has not yet been implemented. 

Removal of Marriage Value from Premiums

The Bill seeks to eliminate 'marriage value' from lease extension and enfranchisement calculations. This is a significant change, as it would reduce the cost, in some cases considerably, of extending a lease with under 80 years unexpired or enfranchising.

It would have significant implications for parts of the property market including increasing the price of some Leaseholds, whilst reducing the value, in some cases significantly, of Freeholders reversionary assets.

Extension of Lease Terms

The standard lease extension term for both flats and houses is proposed to increase to 999 years, from 90 years in flats and 50 years in houses. This change will provide long-term security for leaseholders.

Removal of Ownership Requirement

The Bill also proposes to remove the requirement for a new leaseholder to have owned their property for two years. This amendment would make it easier for new leaseholders to access the benefits of this leasehold reform.

Ban on the Sale of New Leasehold Houses

Under the proposed Bill, the sale of new leasehold houses will be banned. This means that, barring exceptional circumstances, all new houses in England and Wales will be freehold from the start.

Changes to the 'Non-Residential' Limit

The proposed legislation seeks to increase the 'non-residential' limit from 25% to 50%. This means that leaseholders in buildings with up to 50% non-residential floorspace, such as retail and offices, will be able to buy their freehold or take over its management.

Changes to Buildings Insurance Commissions

Under the proposed Bill, buildings insurance commissions for managing agents, landlords, and freeholders will be replaced with transparent administration fees.

Extension of the Building Safety Act 2022

The Bill also seeks to build on the legislation brought forward by the Building Safety Act 2022. This means that freeholders and developers will not be able to escape their liabilities to fund building remediation work, thus further protecting leaseholders.

The Leasehold and Freehold Reform Bill represents a major change for Leaseholders and Freeholders.   

 

For more understanding of the proposed changes, please refer to the Guide to the Leasehold and Freehold Reform Bill on the GOV.UK website.

Emily Norman

Senior Associate Residential Valuation

More from this Author

27/03/2025 Blog | Valuation | Leasehold & Freehold Reform

Leasehold, Commonhold & Rental Reforms - key changes & their potential impact


23/06/2022 Blog | Ground Rents | Valuation

What you need to know about the Ground Rent Act 2022


23/02/2016 Blog | Valuation | Residential Property

If the lease of your property is nearly down to 80 years, act now to preserve the value



Related Insights

  Myth Busting The Impact of AI on Real Estate Valuations
Podcast 27/08/25

Myth Busting The Impact of AI on Real Estate Valuations

Valuation | Commercial Property

Want to know more or would simply like some advice? We hope you find this podcast useful. If you want to know more about topi...

Key Drivers for Drive-Thru Investment Growth in the UK Market
Blog 26/08/25

Key Drivers for Drive-Thru Investment Growth in the UK Market

Valuation

Potential ChallengesInvestors should be mindful of several challenges when considering drive-thru investments:

Is there still life in the UK Life Science Market?
Blog 21/07/25

Is there still life in the UK Life Science Market?

Life Sciences | Valuation

The UK life science market remains active and resilient, but the sector is entering a more nuanced phase as global and domest...

 Terrifying Statistics or Development Opportunities???
Blog 17/07/25

Terrifying Statistics or Development Opportunities???

Development | Valuation

Chronic under-delivery of new housing will likely continue to act as a support for pricing in the face of consistent demand, ...