The Leasehold Reform, Housing and Urban Development Act 1993 is a cornerstone of modern leasehold law in England and Wales. It radically transformed the rights of leaseholders by giving them the legal power to extend their lease or buy the freehold of their building.
If you are a leaseholder of a flat, this Act is likely the foundation of your rights. In this guide, we break down what the Act covers, who it applies to, and how it works in practice.
What Is the Leasehold Reform Act 1993?
The Act is a piece of legislation introduced to balance the scales between freeholders and leaseholders. It provides two critical rights for leaseholders of flats:
- The right to a statutory lease extension
- The right to collectively enfranchise (i.e. buy the freehold with other leaseholders in the block)
These rights were unprecedented at the time and form the basis of leaseholder empowerment today.
Key Provisions of the Act
1. Statutory Lease Extension
- Leaseholders can extend their lease by 90 years in addition to the unexpired term
- Ground rent is reduced to zero (peppercorn rent)
- The freeholder is compensated through a premium
2. Collective Enfranchisement
- A group of leaseholders in a block of flats can jointly buy the freehold
- Requires at least 50% participation from qualifying leaseholders
3. Legal Framework
- Defines the legal notice process (e.g. Section 42 and Section 45 notices)
- Sets the timelines for responding, negotiating, and applying to the First-tier Tribunal if disputes arise
- Establishes rules for calculating the premium, including marriage value (if lease is under 80 years)
Who Qualifies for These Rights?
Historically, leaseholders needed to:
- Own a long lease (originally granted for more than 21 years)
- Have owned the flat for at least 2 years (abolished from 31 January 2025)
With the abolition of the 2-year ownership rule under the 2024 reforms, more leaseholders now qualify immediately.
Other exclusions:
- Landlords that are charitable housing trusts
- Business leases
Marriage Value and the 80-Year Rule
One of the most impactful elements of the Act is the marriage value principle:
- If your lease has less than 80 years remaining, you must pay the freeholder 50% of the uplift in value caused by the lease extension
This makes it crucial to act before the 80-year threshold to avoid higher costs.
The Process Under the 1993 Act
- Valuation
- Get a surveyor to assess the premium
- Section 42 Notice
- Served on the freeholder proposing terms
- Section 45 Counter-Notice
- Freeholder responds within 2 months
- Negotiation
- 6-month window to agree terms
- Tribunal (if needed)
- If no agreement is reached, either party can apply to the First-tier Tribunal
- Completion and Registration
- Once agreed, the new lease is registered at HM Land Registry
Why the 1993 Act Still Matters
Despite newer reforms, the 1993 Act remains the legal backbone of lease extension and enfranchisement in the UK. It has:
- Standardised rights for flat owners
- Created legal certainty and transparency
- Encouraged fair valuation practices
It also laid the groundwork for future reforms in 2002, 2022, and 2024.
FAQs
Do I still need to wait 2 years to extend my lease?
No — as of 31 January 2025, the 2-year ownership rule has been abolished.
Can I extend my lease without my freeholder’s agreement?
Yes — if you follow the statutory process under the 1993 Act.
Can I negotiate the premium?
Yes, but if you cannot agree, the Tribunal will decide.
Is this better than an informal lease extension?
Generally yes — statutory extensions offer better protections and zero ground rent.
Summary of the 1993 Act
| Right | Details |
| Lease Extension | 90 years added, no ground rent |
| Collective Enfranchisement | 50%+ leaseholders can buy freehold |
| Key Notices | Section 42 (claim), Section 45 (response) |
| Tribunal Role | Resolves valuation disputes |
Need Help Using Your Rights Under the 1993 Act?
At Extension.Lease, we:
- Provide accurate lease extension valuations
- Guide you through the notice process
- Support negotiations and represent clients in Tribunal
