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Leasehold Property Rights expert The starting gun has well and truly sounded on leasehold reform. On 31 January 2025, the government published the catchily-titled Leasehold and Freehold Reform Act 2024 (Commencement No. 2 and Transitional Provision) Regulations 2025 (“LAFRA 2024”).
Section 27 Leasehold and Freehold Reform Act 2024
The regulations bring into force Section 27 of the Act, removing the two-year qualifying period for leaseholders before extending their lease or purchasing their freehold. Importantly, this change is retrospective, so it also benefits existing leaseholders.
In addition, Section 27 has abolished some ancillary provisions concerning the service of notices by personal representatives (“PRs”) following a tenant’s death. Previously, PRs could serve a notice of claim in the deceased tenant’s name within two years of the tenant’s death and thereafter in their own names. Now, PRs can make claims in the deceased tenant’s name, provided the tenant was registered at the Land Registry as the property owner.
There are also some minor amendments to the prescribed form notices of claim when applying to acquire the freehold or an extended lease of a house under the Leasehold Reform Act 1967.
Several provisions were already in force
Several provisions of the LAFRA 2024 were already in effect. Those include:
- regulations relating to rent charge arrears;
- the recovery of legal costs through service charges; and
- repealing Section 125 of the Building Safety Act 2022, which addressed remediation costs of insolvent landlords.
Leasehold reform: what’s next?
The government has emphasised that leasehold reform is a priority and is committed to making commonhold the default position in most cases.
However, in her first appearance before the Housing, Communities and Local Government Select Committee, Housing Secretary Angela Rayner cautioned that moving too fast risked “unintended consequences as there are gaps in the current legislation that could cause problems.” Despite that, she confirmed the government’s intention to bring forward further legislation this year.
Change cannot come soon enough for many leaseholders. Uncertainty over the extent of the proposed reforms is making many leasehold properties difficult to market.