The leasehold system in the UK has existed for centuries, but the way it operates today is largely shaped by a series of reforms in the 20th and 21st centuries. Understanding its history helps explain why so many leaseholders still face challenges and why reforms continue to evolve.
⚖️ Early origins of leasehold
- Leasehold ownership dates back to medieval England, when landowners granted tenants rights to occupy land or property for a fixed period in return for rent or service.
- Over time, this developed into a system where property could be owned on a long lease — often 99 or 125 years — with the freeholder retaining ultimate ownership of the land.
- By the Victorian era, leasehold became the dominant way to own flats, particularly in cities like London, because English law did not originally recognise freehold ownership of flats.
🏡 20th century expansion of leasehold
- In the early 20th century, leasehold ownership became widespread, especially for flats in growing urban areas.
- However, this left many households vulnerable, since leases shortened over time and freeholders had significant control. Properties with short leases became hard to sell or mortgage, leading to growing public concern.
📜 Key reforms improving leaseholder rights
- Leasehold Reform Act 1967
- The first major legislation.
- Gave many long leaseholders of houses the right to buy the freehold (enfranchise) or extend their lease.
- Aimed to tackle unfairness where leaseholders risked losing their homes once leases expired.
- Leasehold Reform, Housing and Urban Development Act 1993
- Extended rights to flat owners for the first time.
- Introduced the right for flat leaseholders to:
- Extend their lease by 90 years with ground rent reduced to a peppercorn.
- Join together to collectively buy the freehold (known as collective enfranchisement).
- Commonhold and Leasehold Reform Act 2002
- Introduced the concept of commonhold as an alternative to leasehold, though uptake has been limited.
- Strengthened leaseholder rights around service charges and management of buildings.
- Allowed leaseholders to take over management of their block without buying the freehold (Right to Manage).
- Leasehold Reform Act 2024(most recent)
- Part of the government’s ongoing drive to modernise the system.
- Extended the standard lease extension term to 990 years although this has not been implemented as yet.
- Further restricted the use of ground rents.
- Continued the trend of shifting power and protection towards leaseholders.
📈 Why this history matters today
The history of leasehold shows a clear shift in balance from freeholders towards leaseholders, as successive governments have sought to make ownership fairer and more secure.
- Leasehold still accounts for millions of homes in England and Wales.
- The system is considered outdated by many campaigners, with pressure for further reform and greater use of commonhold.
- For current leaseholders, knowing this history explains why certain rights exist — such as the ability to extend a lease or buy the freehold — and why acting early (for example, before a lease drops below 80 years) is often financially critical.
✅ Summary
Leasehold has deep historical roots in the UK, but the modern system has been shaped by reforms from the 1960s through to the landmark 1993, 2002, and 2024 Acts. Each milestone has increased leaseholder rights, reduced unfairness, and given more security of ownership.
At extension.lease, we specialise in guiding leaseholders through the extension and enfranchisement process — helping you benefit from the rights won through decades of reform.
