This Act, passed in May, promises to tip the scales in favour of leaseholders. No longer will they be forced to pay exorbitant sums just to secure their homes. The Act makes it easier and cheaper to buy the freehold or extend a lease—now, not just for a few decades, but for a staggering 990 years, whether you own a house or a flat. The days of worrying about future extensions, or the value of a short lease, are coming to an end.

Transparency is another cornerstone. Service charges, once shrouded in mystery, must now be presented in a clear, standardised format. Leaseholders can scrutinise and challenge these charges more easily, and if a landlord’s demand seems unreasonable, the path to a Tribunal is now less daunting. The Act even removes the presumption that leaseholders must pay their freeholder’s legal costs when challenging poor practice—a significant deterrent, now gone.

The reforms go further. The sale of new leasehold houses is banned (with rare exceptions), and the notorious commissions on buildings insurance are replaced with transparent, fair fees. The two-year ownership rule before you can extend your lease or buy your freehold? Scrapped.

For those living on private or mixed-tenure estates, the Act extends the same rights of redress and transparency over estate charges. And for blocks with commercial premises, the threshold for leaseholders to take over management or buy the freehold rises from 25% to 50% commercial floor space, opening the door for more collective action.

But when will these changes take effect? Although the Act is now law, most of its provisions await secondary legislation. The new Labour government has pledged swift action, but further consultation may mean several months’ wait.

Looking ahead, the government’s ambitions are even bolder. The King’s Speech in July 2024 promised draft legislation to end the “feudal” leasehold system altogether and revive commonhold as the default for new flats. The government aims to tackle unfair ground rents, abolish the threat of forfeiture for minor debts, and address the injustices of “fleecehold” estates—where homeowners pay steep, unregulated management charges.

So, as a leaseholder, should you extend your lease now or wait for the new regime?

The reforms promise to make the process cheaper, fairer, and more transparent. But with the main provisions not yet in force, the current system still applies. Will waiting save you money and hassle, or could delay risk further lease depreciation and uncertainty?

The answer, as ever, depends on the specific circumstances and risk appetite. The law is changing, but the clock on your lease keeps ticking. Should you act now, or hold out for a better deal? The choice is yours—but the landscape for leaseholders is changing, and the balance of power is shifting at last.

The Ascheri Group’s professionals can provide clarifications or elaborate on specific situations. To receive more information or request a quote for an initial online consultation, please contact us at info@ascherigroup.uk.