Leasehold Reform Act 2024: Everything You Need to Know

A breakdown of the Leasehold and Freehold Reform Act 2024 — what changed, what's being phased in, and how it affects your extension premium.

A Landmark Change in UK Leasehold Law

The Leasehold and Freehold Reform Act 2024 received Royal Assent on 24 May 2024 and is the biggest change to leasehold law in England and Wales in decades. But an Act becoming law and its provisions taking effect are two different things: most of its headline measures need regulations or commencement orders before they apply, and a number of them have not been brought into force. This guide separates what is already in force from what is still waiting, and explains what that means for the cost of extending your lease today.

In Force Today and Still Waiting

Only about ten provisions of the Act have been commenced so far (eight wholly and two partly). Our reform tracker keeps the status up to date.

The Key Changes in Detail

1. 990-year extension term

Today a statutory extension of a flat lease adds 90 years and reduces the ground rent to zero. The Act replaces that with a new lease of 990 years at a peppercorn rent, for flats and houses, so you should not need to extend again. This is not yet in force, so a claim served now still gets 90 years.

2. Marriage value abolished

Marriage value, the 50% share of the extra value created by an extension that a freeholder can claim when your lease has 80 years or fewer remaining, is abolished for residential claims once the provision is commenced. It is the single largest cost for short leases (see marriage value explained). Commencement has been delayed by a legal challenge from freeholder groups, including some of the large London estates. The High Court dismissed the judicial review on 24 October 2025, but the Court of Appeal has granted permission to appeal, so legal uncertainty continues.

3. New valuation rules

The Act lets the Secretary of State prescribe the deferment and capitalisation rates used in premium calculations, and relativity, instead of leaving them to case law and competing surveyors' graphs. The government's consultation on the rates is due to close on 21 October 2026. Until regulations are made, valuers continue to use the 5% rate from Sportelli and graphs such as the Gerald Eve 2016 table, and tribunals follow Sloane Stanley v Mundy in preferring real-world evidence. See relativity tables.

4. Two-year rule removed

You no longer need to have owned your lease for two years before extending or buying the freehold. A buyer of a short-lease flat can serve a notice immediately. This is the one extension-related change that has taken effect.

5. Costs

The Act reverses the default rule that leaseholders pay the freeholder's reasonable costs on extension and enfranchisement claims. For Right to Manage this has applied since 3 March 2025. For extensions and enfranchisement it is not yet in force, so section 60 of the 1993 Act continues to apply and you should budget for the freeholder's costs (see solicitor fees for lease extensions).

6. Right to Manage

The non-residential limit for RTM rose from 25% to 50% on 3 March 2025, bringing more mixed-use buildings into scope. For buying the freehold collectively the 25% limit still applies. See Right to Manage.

7. Transparency, insurance and building management

The Act provides for standardised service charge demands, annual reports and a right to request information, for a ban on hidden insurance commissions replaced by defined “permitted insurance fees”, and for tighter rules on managing agents and redress. These need secondary legislation and none has a confirmed start date. See service charges and the commission ban.

8. New leasehold houses

The Act provides for a ban on granting new long residential leases of houses, with limited exceptions. Commencement has not been confirmed. It does not affect existing leasehold houses.

What the Act Does Not Do

• It does not cap ground rent on existing leases. That is proposed separately in the draft Commonhold and Leasehold Reform Bill 2026 (see the £250 cap), which is not law.
• It does not abolish leasehold or make commonhold the default for existing flats; the 2026 Bill proposes more on commonhold.
• It does not change what you pay today beyond the provisions already in force; extension premiums are still calculated under the 1993 Act rules.

What Should You Do Now?

The question most leaseholders ask is whether to wait. The honest answer depends on your lease length:

• Above about 85 years: waiting is low-risk, but re-check regularly; the lease is still shortening.
• Close to 80 years: serving a section 42 notice before you reach 80 locks the valuation at the notice date and avoids marriage value under today's law. Waiting for abolition risks crossing the line with no confirmed date for reform.
• Below 80 years: on our calculator a £400,000 flat with 70 years left carries about £18,700 of marriage value inside a premium of about £35,600. That is the maximum you could hope to save from abolition alone, and waiting makes the reversion bigger each year.