Offices in
West Sussex & South London

Call us for a quote on 01903 872211 or 020 891 26399

Contact us

2024 Leasehold and Freehold Reform Act

The Leasehold and Freehold Reform Bill completed its journey through parliament on Friday 24th May 2024 and has now received its Royal Assent and is law!  The Act covers a range of subjects including making it easier and cheaper to extend leases and buy the freeholds of residential flats and houses.  The majority of the proposals in respect of changes to the relevant valuations and the process have become part  of the new law however, the proposals to cap existing ground rents at £250 per annum and then abolish ground rents in the future have NOT become law and are not part of the legislation.

The key facts in relation to the valuation and process are as we understand :-

  1. Marriage value abolished and no longer payable for lease extensions where the leases are under 80 years unexpired.
  2. The current 2 year ownership qualification rule to extend leases is abolished.
  3. Lease extensions to be 990 years rather than the current 90 years.
  4. Freeholders recoverable valuation and legal fees to be abolished except in cases where the premiums are low.
  5. The Government is to prescribe the capitalisation and deferment rates used in the valuation calculations and to review these every 5 – 10 years.
  6. The percentage of commercial property floor area within a building allowable in an Enfranchisement claim is to be increased from 25% to 50% which will allow far more mixed use buildings to be capable of Enfranchisement.
  7. In collective Enfranchisement claims freeholders can be forced to retain any non participating flats or other areas of commercial value which will make it cost effective for more leaseholders to pursue the purchase of their freeholds.
  8. The sale of Leasehold houses will be mostly banned.
  9. Ground rents within lease extension premium calculations to be capped at 0.1% of the value of the property.

However, the above sections of the new legislation do not come into immediate effect as there is no actual commencement date in the Act. The Act states the ‘other provisions of this Act come into force on such days as the Secretary of State may by regulations appoint’. This means we will now need to wait for the general election and the next government to be appointed before we have a Secretary of State in office who can progress the legislation to become active law.

We will be posting information upon each of the above proposed changes once further details are known and have been analysed, so do keep a watch on our website!

We at Julian Wilkins & Co Chartered Surveyors have a team of specialist Leasehold Enfranchisement Valuers and can advise upon all valuation matters relating to Lease Extension and Freehold Enfranchisement claims whether to be progressed now or after the legislation has come into force. Please contact us be phone or email if you would like to discuss any particular case on a no obligation basis. Also, please register your details with us if you would like to be kept informed of the above changes as they progress.

Talk to us

Talk to one of our experienced team today, call our central enquiries number on 01903 872211 to find out more about our services or to request a quote.

Contact us