Leasehold Reforms Become Law
On 24 May 2024, the Leasehold and Freehold Reform Bill became law and is now known as the Leasehold and Freehold Reform Act 2024 (“Act”).
The Act is aimed at improving the rights of leaseholders of flats and houses in England and Wales.
1) Ban
There will be a ban on grant of long residential leases of houses unless a permitted exception applies
2) Lease charges
Increase of leaseholder rights relating to service charge costs, insurance and other administration charges that are applied by freeholders. Leaseholders can expect greater transparency and avoid being liable for freeholder costs when challenging service charge demands. The leaseholders will also be able to obtain invoices/ bills in a standard form so they can easily understand the costs breakdown and challenge them if required
3) Lease extensions
- The statutory extension of leases for flats and houses will be standardised to 990 years.
Previously you could only extend for a statutory term of 90 years flats and 50 years in houses. - You do not need to own your flat or house for 2 years before you can extend the lease or buy the freehold.
4) Enfranchisement
You can now take over the management of a site or buy the freehold even if the floor space of the building is 50% non-residential. Previously, leaseholders were unable to buy or take over management of the building if the non-commercial floor area of the building was 25%.
Keep an eye out on our updates as the Act is yet to be implemented by the Secretary of the State.
If you have any questions about the Leasehold and Freehold Reform Act 2024 and require legal advice, please contact our experts in the private property dispute team on 0330 822 3451 or request a callback.
