The Leasehold and Freehold Reform Bill - headlines in relation to lease extension and enfranchisement

The Leasehold and Freehold Reform Bill was introduced into Parliament on 27 November 2023. The long awaited Bill includes reform across different aspects of leasehold. In relation to enfranchisement and lease extension the headlines from the Bill are: 

• An increase in the statutory lease extension term to 990 years (previously 90 years in relation to flats and 50 years in houses) at a peppercorn rent upon payment of a premium. 
• An increase in the current exemption to enfranchisement and building management where more than 25% of the building is ‘non-residential’  up to 50%. This increase will allow more buildings to fall within the remit of the enfranchisement legislation. 
• The removal of ‘marriage value’ which currently affects lease extensions where the term remaining on the lease is less than 80 years at the time of the lease extension application. This will decrease the premium paid by leaseholders of leases with shorter terms left remaining. 
• The removal of the existing requirement for leaseholders to have owned their house or flat for 2 years before they can qualify to purchase the freehold or extend their lease.  

The Bill is in its early stages having only just been introduced, and the Government has already announced plans to introduce further amendments as it progresses through Parliament. For further information on the Bill or any other enfranchisement or lease extensions queries, you can contact Zoe McLean-Wells.