The short version
A handful of leasehold changes are already law and already affect you today — most importantly, you no longer have to wait two years after buying before you can extend your lease or buy your freehold. The headline-grabbing bits — a £250 ground rent cap and a ban on new leasehold flats — are still sitting in a draft Bill that hasn't even been formally introduced to Parliament yet. Don't plan your purchase around reforms that haven't happened.
Budgeting for the other costs of buying a leasehold flat?
Ground rent and service charges are ongoing costs on top of the purchase price, regardless of where reform ends up. Our guide to the other costs of buying a house covers legal fees, surveys, and what leasehold specifically adds to your budget.
Read What Other Costs Are There Besides Stamp Duty? →Why leasehold reform keeps being in the news
Leasehold reform has moved in two separate stages, and conflating them is the single biggest source of confusion for buyers. The first stage, the Leasehold and Freehold Reform Act 2024, received Royal Assent on 24 May 2024 — it is an Act of Parliament, meaning it is already law. But an Act becoming law and an Act actually taking effect are two different things: most of its provisions only apply once the government switches them on through secondary legislation, known as commencement regulations. More than a year on, only a small fraction of the Act's roughly 125 sections have actually been commenced.
The second stage is a much bigger, more ambitious piece of legislation: the draft Commonhold and Leasehold Reform Bill, published for public and parliamentary scrutiny on 27 January 2026. This is where the ground rent cap and the push toward commonhold as the default way to own a flat actually live. As of late October 2026, this Bill has not been introduced to Parliament in final form — it is still being revised after a House of Commons select committee reviewed the draft and reported back in May 2026.
What's already law and already affects you
These changes come from the Leasehold and Freehold Reform Act 2024 and are genuinely in force:
- No more two-year ownership rule. Since early 2025, you can serve notice to extend your lease or buy your freehold as soon as you own the property — you no longer have to wait two years from your purchase date. In practice, your Land Registry application still needs to be processed first, so there's a short administrative delay, but the legal waiting period itself has gone.
- Wider Right to Manage. From March 2025, leaseholders in mixed-use buildings can take over management of their block where the non-residential (shop, office, commercial) floor space is up to 50% of the total, up from the previous 25% limit. This lets more leaseholders in blocks with ground-floor shops or offices take control of service charges and maintenance.
- No more paying the freeholder's legal fees for a Right to Manage claim. Leaseholders who go through the Right to Manage process no longer have to cover their freeholder's legal costs, removing a cost that previously put some leaseholders off making a claim.
What's law but still switched off
These are also part of the 2024 Act — so they are legally settled — but the government has not yet brought them into force:
- Scrapping marriage value. This is the extra cost currently added when you extend a lease with fewer than 80 years remaining. Removing it should make short-lease extensions noticeably cheaper, but the change isn't active yet.
- 990-year standard lease extensions with ground rent reduced to zero, replacing the current 90-year (flats) or 50-year (houses) extension terms.
- A ban on selling new leasehold houses (as opposed to flats), except in limited circumstances.
- Greater transparency on service charges and buildings insurance, including a ban on opaque insurance commissions and a cap on the time and fee freeholders can charge for providing sale information.
- Removing the presumption that leaseholders pay their freeholder's legal costs when challenging mismanagement or poor practice through a tribunal.
A legal challenge from freeholder groups, arguing parts of the Act interfere with their property rights, was dismissed by the High Court in October 2025; an appeal is listed at the Court of Appeal for April 2027. That case is one reason ministers have given for taking a cautious, staged approach to commencing the remaining sections.
What's still only a proposal: the draft Commonhold and Leasehold Reform Bill
This is the part that gets the headlines, and it's the part buyers most often mistake for settled law. None of the following is in force. All of it depends on a Bill that still needs to be introduced, debated, amended and passed by both Houses of Parliament.
A ground rent cap for existing leases
The draft Bill proposes capping ground rent at £250 a year on most long residential leases not already covered by earlier rules, falling to a peppercorn (effectively zero) after a number of years — the draft points to 40 years, though the select committee that scrutinised the Bill recommended a shorter period. A separate consultation on how "quid pro quo" leases (where a low ground rent was historically exchanged for something else, such as a reduced purchase price) should be treated closed in August 2026, and the outcome will likely shape the final version.
Banning the sale of most new leasehold flats
The intention is that new flats would generally be sold as commonhold rather than leasehold, so buyers would own their flat outright and jointly own the building and shared areas with their neighbours, rather than being a tenant of a freeholder under a lease. The draft Bill has not set a confirmed start date for this change.
Easier conversion to commonhold for existing leaseholders
For flats that are already leasehold, the select committee recommended that converting to commonhold should become the default outcome when leaseholders collectively buy their freehold (known as collective enfranchisement), rather than something they have to separately opt into. The government has not yet confirmed whether it will adopt this recommendation in full.
Abolishing forfeiture
Forfeiture is the power that currently lets a freeholder repossess a leasehold home over unpaid charges, sometimes for debts of only a few hundred pounds. The draft Bill proposes scrapping this and replacing it with a more proportionate enforcement system.
A new regulator for managing agents
There is currently no single statutory regulator for the companies that manage leasehold blocks on freeholders' behalf. A 2025 consultation looked at mandatory qualifications overseen by professional bodies; the select committee instead recommended an independent regulator with real enforcement powers, including fines and the ability to remove a firm's licence to operate. The government's fuller response on this is still pending.
Timeline, as things stand in October 2026
The select committee reported on the draft Bill in May 2026 and asked for a government response within two months; that response slipped past its original deadline and was pushed to after the summer parliamentary recess. The government has said it intends to introduce a revised Bill in autumn 2026. Even on an optimistic timetable, the ground rent cap itself is not expected to actually commence before late 2027 at the earliest, and the government's own working assumption has pointed to 2028. Treat every date here as subject to change — this has already slipped multiple times since 2024.
Leasehold vs commonhold: what's actually different
Leasehold (how most flats are owned today)
- You own the right to live in the property for a fixed number of years, not the property itself
- A freeholder (or their managing agent) sets and collects service charges and, often, ground rent
- Lease length runs down over time and can affect value and mortgageability if it gets short
- Disputes over charges or management typically go through a tribunal process
Commonhold (the proposed default for most new flats)
- You own your individual flat outright, with no time limit or lease to run down
- Owners jointly run the building through a commonhold association, rather than answering to an external freeholder
- No ground rent, because there's no freeholder collecting one
- Commonhold already exists in law today, but it's rarely used in practice — the reform aims to change that for new flats
What this means if you're buying a flat now
If you're currently looking at a leasehold flat, the reforms don't give you much to act on yet, but they do affect how you should think about risk:
- Check the lease length and ground rent terms as if none of this reform existed. Lenders are still applying today's criteria, not the proposed future rules, so a lease with fewer than roughly 80-85 years remaining, or a ground rent clause that doubles every few years, can still limit your mortgage options and resale value now.
- Factor in the two-year rule change if you plan to extend quickly. Because you no longer have to wait two years to serve a lease extension notice, if you're buying a flat with a shortish lease you can, in principle, start that process much sooner than before — though marriage value (the extra cost on sub-80-year leases) hasn't been abolished yet, so an extension today is not yet as cheap as it may eventually become.
- Don't price in a ground rent cap that doesn't exist yet. If a seller or agent suggests a high or escalating ground rent "won't matter because of the new rules," treat that with caution — the cap is still a proposal, with no confirmed start date.
- New-build buyers should ask directly whether a flat will be sold as leasehold or commonhold. Some developers are already moving toward commonhold or leasehold terms closer to what's proposed, ahead of any legal requirement to do so, as a selling point.
Official source
Legislation.gov.uk, the UK Parliament website and House of Commons Library research briefings are the source for the commencement status, draft Bill timeline and committee findings in this article. Because the legislative position continues to move, always check these directly for the latest status before relying on any date here.
Frequently asked questions
Is leasehold being abolished in 2026?
Not yet. Some leasehold changes from the Leasehold and Freehold Reform Act 2024 are already in force, including the removal of the two-year ownership rule before you can extend your lease or buy your freehold. But the bigger changes — a ground rent cap, a ban on new leasehold flats, and a route to make commonhold the default — are still in a draft Commonhold and Leasehold Reform Bill that has not yet been introduced to Parliament, let alone passed into law.
Is the £250 ground rent cap law yet?
No. The £250 annual ground rent cap, falling to a peppercorn after a set number of years, is a proposal in the draft Commonhold and Leasehold Reform Bill published for pre-legislative scrutiny in January 2026. The government is expected to introduce a revised Bill to Parliament in autumn 2026, and even then the cap itself is likely to need further time, possibly into 2027 or 2028, before it actually takes effect.
What leasehold changes have already come into force?
From early 2025, leaseholders no longer have to own their flat or house for two years before they can serve notice to extend their lease or buy their freehold. From March 2025, the Right to Manage was widened so mixed-use buildings qualify where non-residential space takes up to 50% of the floor area, and leaseholders making a Right to Manage claim no longer have to pay their freeholder's legal costs. Most other changes in the 2024 Act, including scrapping marriage value and introducing 990-year lease extensions, are law but still waiting for secondary legislation to switch them on.
Will I still be able to buy a new-build flat as leasehold?
Right now, yes. The proposed ban on selling new leasehold flats is part of the draft Bill, not current law, so developers can still sell new flats on a leasehold basis today. If the Bill passes broadly as drafted, new flats would generally need to be sold as commonhold instead, but there is no confirmed date for this yet.
Does any of this affect my mortgage application right now?
Not directly. Lenders are still assessing leasehold properties under their existing criteria, including minimum remaining lease length (commonly 70 to 85 years or more at the end of the mortgage term, depending on the lender) and the terms of any ground rent clause. None of the proposed reforms have changed lender policy yet, so a short lease or an onerous ground rent clause can still affect what you can borrow and which lenders will consider the property.
What should I check if I'm buying a leasehold flat today?
Ask your conveyancer to check the remaining lease length, how the ground rent is set and whether it doubles or rises on a fixed schedule, the service charge history, and whether the freeholder or managing agent has any history of disputes. Don't assume future reforms will apply retrospectively to your lease — plan your purchase around the rules that exist today, and treat any ground rent cap or commonhold right as a possible future bonus rather than something to rely on.
This guide is for general information and doesn't constitute financial or legal advice. Leasehold and commonhold reform law is changing, and the position described here reflects the status as of 25 October 2026 — it may change before, or instead of, being enacted. Always check GOV.UK and the UK Parliament website for the latest position, and speak to a qualified solicitor or conveyancer about any specific leasehold property before you commit to buying it.