Do you own a Leasehold Property? Read on for changes that may affect you!
In a recent update from the government in March 2025, the government confirmed their plans to improve the leasehold system, which is expected to change the rights of Leaseholders.
One of the proposed changes from the government is to replace the right to extend the term of a lease via a lease extension from the current legislation of 90 years to 990 years. This will allow the leasehold covenant structure to remain, which is required for some leasehold properties to work, but will provide more security for leasehold owners on the length of their lease and tenure.
Key Leasehold Reforms: Lease Extensions, Costs, and Valuation Changes
It is proposed that there will be a removal of Freeholder’s/Landlord’s legal and valuation costs. Currently if you want to extend a lease you would need to pay the Freeholder’s/Landlord’s costs which can be unreasonable. Further information on the same is expected in the new regulations to be issued this year. There are also plans to change the premium payable to extend a lease.
When the term of the lease drops below 80 years the Freeholder/Landlord can together with their costs, charge a large premium to extend the lease. The government is set to open a consultation on how they can change the valuation process to make it fairer and perhaps replaced with a calculator to work out the premium.
At this stage it is unknown what the exact changes will be and for leaseholders they will need to consider whether to proceed with a lease extension or wait until the reforms are in place. This will of course depend on the individuals’ circumstances and need to sell or remortgage whilst the reforms are awaited.
We expect there to be more details and information available towards the end of 2025.
Want to know more about these Leasehold Law Changes and to stay updated?
For professional guidance on lease extensions, freehold purchases, and leasehold enfranchisement, contact Richard Palfreyman rpaltfreyman@fionabruce.co.uk and Luke Hodgkinson lhodgkinson@fionabruce.co.uk in our Commercial Property team today. Fiona Bruce Solicitors can help you to understand your rights and take advantage of the latest leasehold reforms to assist secure your property future.
The contents of this post do not constitute legal advice and are provided for general information purposes only.
The contents of this post do not constitute legal advice and are provided for general information purposes only ■
