TRW & Co · Real estate
Leasehold and Freehold Reform Act 2024: What Has Changed
Leasehold reform under the Leasehold and Freehold Reform Act 2024 promises 990-year extensions and the end of marriage value, but as of October 2026 those valuation changes are not yet in force. Only the two-year ownership rule and right to manage reforms are live. Here is what has changed, what is still pending and how to decide whether to extend now.
Key pointThe cheaper valuation rules are not in force yet: a statutory claim served today is still priced under the old method, including marriage value where 80 years or fewer remain. Waiting is a timing bet, not a guaranteed saving.
At a glance
Royal Assent
The Leasehold and Freehold Reform Act 2024 received Royal Assent on 24 May 2024, but most of its provisions need further secondary legislation before they apply.
Two-year rule gone
Since 31 January 2025, leaseholders can extend their lease or buy the freehold without first owning the property for two years.
Valuation not yet changed
Marriage value removal, prescribed rates and 990-year extensions are not in force; claims are still valued under the existing statutory method.
The 80-year line
Under current rules marriage value is nil only where more than 80 years remain, and the landlord takes half of it below that line.
More reform coming
A Commonhold and Leasehold Reform Bill is expected to fix technical flaws, propose a ground rent cap and pave the way for commencement.
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Leasehold reform in 2026: the short answer
Leasehold reform in England and Wales is happening in stages, and as of October 2026 most of the headline changes are law on paper but not yet switched on. The Leasehold and Freehold Reform Act 2024 received Royal Assent on 24 May 2024. It promises 990-year lease extensions, the removal of marriage value from the premium calculation and a new, government-set valuation method. Those valuation and extension changes are not yet in force.
Two practical changes are already live. Since 31 January 2025, leaseholders no longer have to own their flat or house for two years before claiming a statutory lease extension or buying the freehold. Since 3 March 2025, reformed right to manage rules apply, including wider eligibility for mixed-use buildings and the end of the rule that leaseholders pay the landlord's costs of a right to manage claim.
The rest depends on secondary legislation, a consultation on the rates used to value claims, technical fixes promised in a new Commonhold and Leasehold Reform Bill, and the outcome of freeholders' appeals against the 2024 Act. This guide explains what has changed, what has not, and how to decide whether to act now or wait.
What the Leasehold and Freehold Reform Act 2024 does
The Leasehold and Freehold Reform Act 2024 is the largest change to residential leasehold law in decades. Its long title describes its purposes: restricting new long leases of houses, amending leaseholders' rights to buy the freehold and extend their leases, giving a right to reduce ground rent to a peppercorn, regulating landlord and tenant relationships and estate management, regulating rentcharges, and amending the Building Safety Act 2022.
For most flat owners, the provisions that matter are the ones that change how much a lease extension or freehold purchase costs and how long the new lease runs. For investors and freeholders, the same provisions change what a reversion is worth. That is why the reforms have been contested in Parliament and in the courts.
The main enfranchisement changes
Once commenced, the Act will change the statutory rights under the Leasehold Reform Act 1967 (houses) and the Leasehold Reform, Housing and Urban Development Act 1993 (flats). In summary:
- 990-year extensions. The standard statutory extension will be 990 years for both houses and flats, with ground rent reduced to a peppercorn on payment of a premium. Today the flat route gives 90 years on top of the existing term and the house route gives 50 years.
- Marriage value removed. Marriage value will no longer form part of the statutory premium calculation.
- Prescribed rates. The Secretary of State will set the deferment and capitalisation rates used to value claims, rather than leaving them to argument between valuers.
- Costs. In most cases leaseholders will no longer have to pay the freeholder's non-litigation costs of an enfranchisement claim.
- Wider eligibility. Some qualifying hurdles are removed or relaxed, including the two-year ownership rule, which has already gone.
What is in force and what is not (as of October 2026)
The single most common misunderstanding about leasehold reform is that the cheaper valuation rules already apply. They do not. The House of Commons Library briefing on the reforms records that the majority of the Act's provisions are not yet in force, and that the freehold purchase and lease extension provisions depend on fixing technical flaws through the forthcoming Commonhold and Leasehold Reform Bill.
| Measure | Status | What it means now |
|---|---|---|
| Two-year ownership rule removed | In force since 31 January 2025 | A new buyer can serve a statutory notice immediately after completion |
| Right to manage reforms | In force since 3 March 2025 | Wider eligibility for mixed-use buildings; leaseholders no longer pay the landlord's RTM costs |
| 990-year extensions for houses and flats | Not yet in force | Statutory flat extensions still add 90 years; house extensions still add 50 |
| Marriage value removed | Not yet in force | Marriage value still applies where 80 years or fewer remain |
| Prescribed deferment and capitalisation rates | Consultation run in 2026; rates to follow in secondary legislation | Rates are still argued case by case and settled by tribunal decisions |
| Service charge, insurance and litigation cost measures | Government response July 2026; implementation expected from 2027 | Existing statutory protections continue to apply |
| Ground rent cap | Proposed in the forthcoming Bill, not law | Existing ground rent terms remain enforceable |
The Library also notes that the government confirmed in July 2026 that service charge, insurance and litigation cost measures will be implemented, with secondary legislation to be laid in 2026 and implementation expected "as soon as possible from 2027".
Marriage value, the 80-year line and valuation
Under the current rules in Schedule 13 to the 1993 Act, the premium for a flat lease extension includes three elements: the loss of ground rent, the value of the landlord's reversion, and the landlord's share of marriage value. Marriage value is the uplift created when the leaseholder holds a longer lease. The landlord's share is 50 per cent, and marriage value is treated as nil where more than 80 years remain unexpired at the date of the claim.
That is why the 80-year line drives so many decisions. A lease that falls below it becomes markedly more expensive to extend, and many lenders treat shorter leases with caution. The 2024 Act will remove marriage value altogether, which will matter most for leaseholders whose leases are already well below 80 years.
Why the rates matter as much as marriage value
Removing marriage value is only half the story. The Act lets the Secretary of State prescribe the deferment rate (which values the landlord's right to get the property back) and the capitalisation rate (which values the ground rent stream). In 2026 the government consulted on those rates. A small change in a prescribed rate can move a premium as much as the marriage value change itself, so nobody can say with confidence what a claim will cost under the new regime until the rates are set.
Leasehold reform will make many lease extensions cheaper, but the saving depends on rates that have not yet been fixed and on legislation that has not yet been switched on.
Should you extend now or wait for leasehold reform?
This is the question most leaseholders ask. There is no single answer, but the decision usually turns on four factors: how many years remain, whether you need to sell or remortgage soon, how ground rent is structured, and how much risk you can tolerate on timing.
- Check the unexpired term. Find the start date and length in the lease or the HM Land Registry title. Work out the years left today and at the date you may sell or refinance.
- Get a current valuation. Instruct a specialist valuer to price a statutory extension under today's rules and estimate the effect of falling further below 80 years while you wait.
- Map your deadlines. A sale, remortgage or product expiry may force your hand. A buyer's lender may not accept a short lease, whatever the future law may say.
- Consider protecting your position. Serving a statutory notice now fixes the valuation date. A seller can usually assign the benefit of a served notice to a buyer with the flat.
- Weigh an informal deal. Some landlords will negotiate. Check the new ground rent, review clauses and term carefully, because an informal extension does not carry the statutory protections.
- Decide and document. Record why you chose to proceed or wait, and set a review date tied to the next government announcement on commencement.
Leaseholders with long leases (well above 80 years) generally lose little by waiting. Those near or below 80 years face a harder choice: each year of delay can increase the premium under today's rules, while the commencement date of the new rules remains uncertain.
If you are selling a flat with a short lease, a buyer's lender is likely to look at the lease as it stands, not at what the reforms may offer later. Serving a section 42 notice before marketing, and assigning it on completion, is often the most practical way to keep a sale on track.
An illustrative scenario
This scenario is illustrative only and does not describe a real client or matter.
A leaseholder owns a London flat with around 72 years left and plans to sell in the next 18 months. Under today's rules the premium includes marriage value because the lease is below 80 years. She has read that the new law will abolish marriage value and wants to wait.
Her solicitor and valuer model two paths. On the first, she serves a statutory notice now, fixes the valuation date and assigns the claim to her buyer, who completes the extension. On the second, she waits; if the new rules are not in force by the time she sells, her buyer's lender may refuse the short lease or the price may reflect the cost of extending. She chooses to serve the notice, because a delayed sale would cost more than the possible saving. A leaseholder with no plans to move and a longer lease might reasonably reach the opposite conclusion.
Right to manage, service charges and estate management
Leasehold reform is not only about premiums. The right to manage changes in force since March 2025 make it easier for leaseholders in some mixed-use buildings to take over management, and remove the cost burden of paying the landlord's costs of the claim. For leaseholders in blocks with commercial units at street level, which are common in London, that can open a route that was previously closed.
The service charge transparency measures, controls on insurance commissions and changes to litigation costs are expected to arrive from 2027. Until then, leaseholders still rely on the existing statutory protections, including consultation requirements for major works and the right to challenge the reasonableness of service charges at the First-tier Tribunal (Property Chamber). Freehold estate owners paying estate charges should also watch for the new estate management regime in the Act, which is among the provisions awaiting commencement.
Leaseholders in buildings with fire safety defects should read our guides to the Building Safety Act and remediation contribution orders, because the 2024 Act also amended parts of that regime.
Risks and common mistakes
Assuming leasehold reform already applies
Online calculators and headlines sometimes describe the abolition of marriage value as if it were live. It is not. If you serve a statutory notice today, the premium is calculated under the current rules, including marriage value where 80 years or fewer remain. Proposing a premium in your notice based on rules that are not in force can create problems later, so obtain a valuation on the law as it stands and treat any future saving as a separate scenario.
Letting the lease drift below 80 years
Every year counts once a lease approaches 80 years. Under the current regime, the moment the unexpired term reaches 80 years or less, marriage value becomes payable, and the landlord's share is 50 per cent of it. Leaseholders who wait for reform without a clear commencement date risk paying more under the existing rules if they later need to act quickly, for example because of a sale, a remortgage or a lender's requirements.
Accepting an informal extension without reading the terms
Some landlords offer informal extensions that look attractive but carry new ground rent, review clauses that increase the rent over time, or a shorter term than the statutory route gives. An informal deal also lacks the statutory valuation framework and tribunal backstop. Compare any informal offer against the statutory route, and read the proposed lease line by line before agreeing heads of terms.
Ignoring the judicial review and commencement risk
The High Court dismissed freeholders' challenges to the Act in October 2025, but the Court of Appeal has since granted permission to appeal. Government has also said the extension and freehold purchase provisions need fixing through new primary legislation. Any plan that depends on a specific commencement date for the new valuation rules carries risk. Build in a fallback if the date slips.
Overlooking Wales and Scotland differences
Most of the Act applies in England and Wales, but the Welsh Government will make its own subordinate legislation to implement it, so timings may differ. Scotland has a separate property law system in which long residential leasehold is rare, and the Act does not apply there. Cross-border investors with portfolios in several nations should not assume one timetable fits all.
Overseas owners and cross-border considerations
Many London flats are owned by people living abroad, including in Bangladesh, the Gulf and Singapore. The reforms affect them in the same way as UK residents, but the practicalities differ. Notices must give an address in England and Wales for service, deadlines run regardless of where the leaseholder lives, and lenders and buyers will still scrutinise the lease term.
Overseas owners should appoint a solicitor in England to receive notices, keep the title and lease documents accessible, and plan any extension around their sale or refinancing timetable. Our residential property team and international private client team regularly coordinate these issues for owners outside the UK.
What to do next
Whether you are a leaseholder, a freeholder or an investor, the sensible approach to leasehold reform is the same: understand where your lease sits today, model both regimes, and act on your deadlines rather than on headlines.
- Confirm the unexpired term and the ground rent terms from the lease and the title.
- Obtain a valuation under the current rules and an estimate under the reformed rules once rates are published.
- Read our step-by-step guide to the lease extension process, including the section 42 notice and tribunal timetable.
- Freeholders and investors should review the value of reversions and ground rent income in light of the proposed cap and the Act's valuation changes, with help from our leasehold enfranchisement solicitors.
- Keep a watching brief on the forthcoming Bill, the valuation rates and the Court of Appeal.
If you would like us to review your lease or your portfolio, contact our London office.
Frequently asked questions
01Is marriage value abolished yet?
No. The Leasehold and Freehold Reform Act 2024 removes marriage value from the statutory calculation, but that provision is not yet in force as of October 2026. A statutory lease extension claim made today is valued under the existing rules in the 1993 Act, so marriage value is still payable where the lease has 80 years or fewer remaining at the date of the claim. The government has said the extension and freehold purchase provisions need technical fixes in new primary legislation before they can be switched on, so no firm commencement date is available.
02Can I extend my lease to 990 years now?
Not under the statutory route. The 990-year term is part of the reformed extension provisions that are not yet in force. Today a statutory flat extension adds 90 years to the existing term at a peppercorn ground rent, and a statutory house extension adds 50 years. You can agree a longer term informally with your landlord, including 990 years, if the landlord is willing, but the price and terms are then a matter of negotiation rather than statute.
03Do I still need to own my flat for two years before extending?
No. The two-year ownership requirement was removed on 31 January 2025 for both lease extensions and freehold purchases. A buyer can therefore serve a statutory notice soon after completing. Before that change, sellers often served the notice and assigned the benefit to the buyer, and that remains a useful technique where the buyer wants the valuation date fixed or the extension underway before completion.
04Should I wait for leasehold reform before extending?
It depends on your lease length and plans. Leaseholders with well over 80 years left generally lose little by waiting. Those close to or below 80 years face a trade-off: under current rules the premium rises as the term shortens, while the date the cheaper rules will apply is uncertain and still subject to legislation and appeals. If you need to sell or remortgage soon, waiting can cost more than it saves. Get a valuation under today's rules and model the risk of delay before deciding.
05What has changed for right to manage?
Reforms in force since 3 March 2025 widen eligibility for right to manage in mixed-use buildings, by relaxing the limit on non-residential floorspace, and remove the general requirement for leaseholders to pay the landlord's costs of a right to manage claim. This makes right to manage a more realistic option for many London blocks with shops or offices on the ground floor. Leaseholders still need to follow the statutory notice process carefully.
06Does the 2024 Act apply in Wales and Scotland?
Most of the Act applies in England and Wales, but the Welsh Government will make its own subordinate legislation to implement it, so timing in Wales may differ from England. Scotland has a separate property law system and the Act does not apply there. Northern Ireland also has its own regime. Owners with property in more than one nation should check the rules for each location separately.
Sources and official materials
- Leasehold and Freehold Reform Act 2024 — The Act as enacted and amended, with commencement information
- House of Commons Library: Leasehold reform in England and Wales — What is in force, what is pending and the reform timetable
- Leasehold Reform, Housing and Urban Development Act 1993, Schedule 13 — Current premium calculation and marriage value rules
- Leasehold Reform, Housing and Urban Development Act 1993, section 39 — Right to a new lease, as amended from 31 January 2025
- GOV.UK: Leasehold property – extending the lease — Government overview of lease extension rights
- First-tier Tribunal (Property Chamber) — Tribunal for leasehold valuation and service charge disputes
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.