The Leasehold and Freehold Reform Act 2024 is the latest and most ambitious attempt to modernise leasehold law in England and Wales. Its stated aim is to empower leaseholders, simplify ownership structures, and reduce unfair costs.
However, while the Act has passed Parliament, not all of its reforms are yet in force. Several key measures require secondary legislation before they can take effect — and some are already facing legal challenges from freeholders, raising the risk that they may be diluted or never implemented.
🔑 Main reforms included in the 2024 Act
- Removal of the 2-year ownership rule ✅
- Leaseholders no longer have to wait two years after buying their property before they can extend their lease or buy the freehold.
- This provision is already in effect, making it easier for buyers of short leases to act immediately.
- Ban on new leasehold houses ✅
- The sale of new leasehold houses has been banned (with limited exceptions such as Crown or National Trust land).
- This ensures most new houses must now be sold as freehold, addressing a long-standing consumer concern.
- Lease extensions of up to 990 years ⚠️ Not yet in effect
- The Act proposes that leaseholders should be able to extend their lease by up to 990 years with ground rent reduced to a peppercorn (nil).
- However, this measure is not currently in force and depends on secondary legislation.
- It is also the subject of legal challenges from freeholders, who argue under human rights law that these provisions unfairly strip value from their property interests.
- Capping of ground rents in premium calculations ⚠️ Not yet in effect
- Another major reform is the proposal to cap ground rent when calculating lease extension or enfranchisement premiums.
- This could significantly reduce the price payable by leaseholders, particularly those with onerous or escalating ground rents.
- As with 990-year lease extensions, this change is not yet in force and is at risk of being delayed, diluted, or struck down due to ongoing landlord-led legal challenges.
- Streamlined enfranchisement and Right to Manage
- The Act includes measures to simplify the processes for extending leases, buying the freehold collectively, or taking over management of a block.
- While some procedural reforms are expected to take effect, the full detail depends on further regulations.
⚖️ Legal challenges and uncertainty
Freeholder groups and institutional landlords have already commenced legal proceedings against aspects of the 2024 Act, particularly the valuation reforms (990-year extensions and ground rent capping).
- These challenges are based on human rights grounds, with freeholders arguing that the reforms unlawfully deprive them of the value of their assets.
- Depending on the outcome, parts of the Act could be delayed, watered down, or removed entirely.
- Until these cases are resolved and secondary legislation is enacted, leaseholders cannot yet rely on these headline changes in practice.
📈 What this means for leaseholders
- Some reforms are already in effect (no 2-year rule, ban on new leasehold houses).
- Other reforms are not yet law in practice (990-year extensions, ground rent capping).
- There is a real risk of delay or dilution due to legal challenges.
- Leaseholders should therefore continue to work under the current framework of the 1993 Act and related case law, rather than assuming the 2024 reforms will apply.
✅ Summary
The Leasehold and Freehold Reform Act 2024 promises significant benefits for leaseholders — including longer lease extensions, capped ground rents, and simpler processes. But while some provisions are already active, the most valuable reforms are not yet in force and may be subject to change due to ongoing freeholder legal challenges under human rights law.
At extension.lease, we closely monitor the progress of the Act and its implementation. We provide clear, up-to-date advice so you know what rights you can rely on today — and what reforms may still be some way off.
For the latest advice on which reforms are in force now — and what’s still pending — our experts can explain exactly how the law applies to you.
