Government Consults on Leasehold Enfranchisement Reform

The government has published two linked consultations on how to implement key parts of the Leasehold and Freehold Reform Act 2024 (LFRA 2024). Both consultations relate to England, with corresponding powers for Welsh Ministers who have stated they will implement equivalent reform in Wales.

background

Leaseholders in England and Wales have long-standing statutory rights to extend their lease or buy the freehold of their property, but the process has been criticised as expensive, complex, and unfair to leaseholders, resulting in the LFRA 2024 making significant changes to the enfranchisement system including:

• Introducing a new Standard Valuation Method for calculating the price leaseholders pay to extend their lease or buy the freehold, removing the requirement for "marriage value" to be paid and capping the treatment of ground rents in the calculation.
• A new default rule that each party pays their own process costs (legal and valuation fees), ending the previous regime under which leaseholders had to pay their landlord's costs as well as their own, subject to exceptions — for example where the purchase price falls below a set threshold, or the enfranchisement claim fails, landlords may recover a fixed sum towards costs.
• New powers for the Secretary of State to prescribe the deferment and capitalisation rates used in the valuation calculation, so these no longer need to be negotiated case by case.

consultations

The 2 consultations: Leasehold enfranchisement process costs - GOV.UK and Leasehold enfranchisement valuation rates - GOV.UK, deal with the implementation of these reforms. Those likely to be affected by the changes to the enfranchisement rules should consider engaging with the consultation process before the deadline of 23 September 2026.

two further public consultations have launched today to drive forward enfranchisement reforms – marking the next step in making it easier for leaseholders to extend their lease or buy their freehold

https://www.gov.uk/government/news/stronger-leasehold-protections-in-crackdown-on-hidden-fees