The Leasehold & Freehold Reform Act 2024-Update November 2024

The leasehold and freehold reform act 2023/2024 obtained Royal ascent on the 24th of May 2024. The leasehold and freehold reform act 2024 applies to properties in England and Wales and was part of the previous governments White paper to increase fairness for leaseholders and to crack down on unfair Leasehold practices.

In brief the Act sets out the following;

1. to make it cheaper and easier for leaseholders to extend their leases or buy their freehold.

2. to change the qualifying criteria to give more leaseholders the rights to extend leases or buy freehold or to take over the management of a block of flats.

3. the lease extension term is currently 90 years and will be extended to 990 years and the same provision of a peppercorn ground rent will also be retained.

4. new leases for houses will be prohibited.

5.transparency with regard to service charges and administration charges in blocks of flats and their management will be improved.

6. the costs that leaseholders normally pay when extending their leases or buying their freehold will be removed so each party will bear their own costs. Freeholders in other words will not be able to claim their costs to be reimbursed .

When will leaseholders benefit is open to conjecture and although Royal ascent has been given the majority of the provisions are not in force. Secondary legislation will be required. The labour government has committed to act quickly to bring in the new provisions, although other sources have declared a five year delay.