Nearly 4.5 million households in England and Wales live in leasehold properties, and the rules that govern those leases are about to change more dramatically than anything we’ve seen in decades. That figure alone tells you this isn’t a niche issue — it affects millions of people who own a home but don’t own the land it sits on. I’ve been writing about UK property law for long enough to know that leasehold reform has been promised before, but the draft legislation published in January 2026 is different. It’s detailed, it’s ambitious, and parts of it are already in force.
The problem is that most leaseholders don’t realise how much of this reform is already law and how much is still stuck in the legislative pipeline. If you act on what you think is coming rather than what’s actually in force, you could make an expensive mistake. Here’s what you actually need to know.
If you’re currently renting rather than owning, the same principles of understanding your agreement apply — decoding the jargon in your tenancy agreement is just as important as knowing your leasehold rights. And if you’re a leaseholder wondering whether you need professional advice right now, a tenant landlord lawyer can help you understand where you stand under current law.
What Leasehold Actually Means and Why the Definition Matters Now
The most important thing to understand about leasehold isn’t the textbook definition — it’s the consequence. When you buy a leasehold property, you own the building but not the land it stands on. That means you have a ticking clock on your ownership, and the shorter that clock gets, the more it costs you to fix it. The reforms are trying to change that dynamic, but they’re doing it in stages.
What I tend to notice is that people focus on the headline reforms — the ban on new leasehold flats, the ground rent cap — and assume everything has changed. It hasn’t. The essential guide to finding your ideal UK apartment is still relevant because the basics of what you’re buying haven’t shifted overnight. The key is knowing which parts of the reform are live and which are still theoretical.
Why the Timing of These Reforms Affects Your Wallet Right Now
Here’s where it gets practical. If your lease has dropped below 80 years, you are currently still liable for marriage value — that’s the theoretical increase in your flat’s value after a lease extension, and you have to pay 50% of it to your freeholder. The reform that abolishes marriage value is not yet in force and is unlikely to be until 2027 or 2028. That means waiting could save you thousands, but it also means your lease keeps shrinking, which makes the property harder to sell.
Consider this scenario: your flat has 78 years left on the lease. Under current law, extending it costs you a premium that includes marriage value. If you wait until the reform kicks in, that cost drops significantly. But if you need to sell in the next two years, a lease under 80 years is a major deterrent for buyers. You’re caught between a financial penalty now and a practical problem later.
The negotiation tactics that work for renters don’t apply here — this isn’t about haggling. It’s about understanding a legal framework that is shifting beneath your feet. My advice would be to get a professional valuation of your lease extension cost under current law, then model what it would look like after the marriage value abolition. That comparison tells you whether to act now or hold tight.
If you’re unsure where you stand, speaking to a property lawyer who specialises in leasehold can clarify your options without committing you to a costly process.
Where Leaseholders Commonly Get Tripped Up by the Reforms
The biggest mistake I see is people assuming the draft Bill is already law. It isn’t. The Draft Commonhold and Leasehold Reform Bill was published in January 2026, but it’s only at the pre-legislative scrutiny stage. That means it could change, be delayed, or even stall entirely. Acting as if the reforms are in place could lead you to make decisions that cost you money under current law.
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| Reform | Status | Expected Timeline |
|---|---|---|
| Abolition of two-year ownership rule | In force | 31 January 2025 |
| Right to Manage changes | In force | 3 March 2025 |
| Ground rent cap (£250/year) | Proposed | Unknown |
| Abolition of marriage value | Proposed | 2027 or 2028 |
| Ban on new leasehold flats | Proposed | Unknown |
| 990-year standard lease extensions | Proposed | Not yet in force |
Assuming the ground rent cap applies to your lease now
The proposed cap of £250 per year, dropping to a peppercorn after 40 years, would be a major shift. It would apply to many existing leases, not just new ones. But it is not yet law. If you’re currently paying ground rent above £250, you cannot stop paying it based on a proposal. You would be in breach of your lease. The reform is significant, but it’s not enforceable until the Bill receives Royal Assent.
Waiting for marriage value abolition without a plan
This is the most consequential trap. Marriage value can add tens of thousands of pounds to the cost of extending a lease under 80 years. The reform to abolish it is real, but it’s been challenged legally — a judicial review was dismissed in October 2025, but the implementation is still years away. If your lease is approaching 80 years, waiting without a backup plan is risky. You could end up with a lease so short that it becomes unmortgageable.
Ignoring the Right to Manage changes already in force
Since 3 March 2025, leaseholders in mixed-use buildings can exercise the Right to Manage if the non-residential floor space is under 50% — up from the old 25% limit. Each party now bears their own costs unless the tribunal orders otherwise. If you live in a building with a shop or office on the ground floor, you may now be eligible to take over management when you weren’t before. Many leaseholders don’t know this change has already happened.
Believing forfeiture has already been abolished
The draft Bill proposes to abolish forfeiture — the mechanism that can theoretically let a freeholder take your home over relatively small arrears. But this is not yet law. Forfeiture still exists. If you are in arrears, you are still at risk. The reform would replace forfeiture with a court-supervised process, but until that happens, the old rules apply.
If you’re dealing with a dispute over service charges or ground rent, a tenant landlord lawyer can advise on your current legal position without waiting for reforms that may not arrive for years.
What You Can Actually Do Now to Protect Your Position
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The reforms are real, but they’re phased. Here’s what you can do right now to make sure you’re not caught out by the gap between what’s promised and what’s in force.
Get a professional valuation of your lease extension cost under current law
You cannot make a smart timing decision without knowing the numbers. A surveyor specialising in leasehold enfranchisement can calculate the premium you’d pay today, including marriage value if your lease is under 80 years. Then ask them to model the same extension under the proposed reforms — without marriage value, with the new ground rent cap, and with the 990-year term. The difference tells you whether waiting is worth the risk. If the saving is modest and your lease is heading toward 80 years, acting now may be the safer call.
Check your eligibility for Right to Manage under the new rules
If your building has commercial space, check whether the non-residential floor area is under 50%. If it is, you may now qualify for RTM where you didn’t before. The process involves forming a RTM company, serving notice on the freeholder, and then taking over management. You no longer have to pay the freeholder’s legal fees for the claim. This is one of the few reforms already in force, and it’s widely underused.
Understand the commonhold conversion pathway
The draft Bill proposes that existing leaseholders can convert to commonhold if at least 50% agree. Commonhold means you own your property outright with no landlord and no ground rent. Only about 20 commonhold developments have been created since 2002, so the process is unfamiliar to most solicitors. If you’re in a block where leaseholders are frustrated with the freeholder, this is worth discussing with a specialist now — the legal framework is being simplified, but early movers may face fewer procedural bottlenecks.
Prepare for the ban on new leasehold flats
If you’re planning to buy a new-build flat, the ban on leasehold sales is coming. Most new flats would be sold as commonhold instead. That changes what you’re buying — no ground rent, no freeholder, but also a less established legal framework. If you’re considering a new-build purchase in the next 12 to 18 months, ask the developer explicitly whether the property will be leasehold or commonhold. The answer affects your long-term costs and your resale value.
- 1Get a current lease extension valuationInstruct a surveyor to calculate the premium under today’s law, including marriage value if applicable. Then ask for a modelled cost under the proposed reforms to compare.
- 2Check RTM eligibility for your buildingMeasure the non-residential floor space. If it’s under 50%, you can form a RTM company and serve notice. The freeholder no longer gets to claim their legal fees from you.
- 3Discuss commonhold conversion with neighboursIf at least 50% of leaseholders in your block agree, conversion to commonhold may become viable under the new Bill. Start the conversation early.
- 4Ask developers about tenure before buying new-buildWith the ban on new leasehold flats approaching, confirm whether a new-build flat will be leasehold or commonhold. This affects ground rent, service charges, and resale.
If you’re buying a new-build and want to understand the implications of commonhold versus leasehold, a real estate lawyer can walk you through the differences before you commit.
Frequently Asked Questions
Can I extend my lease immediately after buying now? ▾
Will the ground rent cap apply to my existing lease? ▾
What happens if my lease is under 80 years and I wait for reform? ▾
Can my freeholder still take my home for minor arrears? ▾
How do I know if my building qualifies for Right to Manage now? ▾
Will new flats still be sold as leasehold? ▾
If you’re dealing with a specific dispute or need clarity on your lease terms, a tenant landlord lawyer can give you advice based on current law, not proposed reforms.
What to Do Next
The leasehold reforms are real, but they’re arriving in pieces. The two-year ownership rule is gone. The Right to Manage changes are in force. Everything else — the ground rent cap, the marriage value abolition, the ban on new leasehold flats — is still proposed. The smartest move you can make is to get a professional valuation of your current position, compare it to what the reforms would change, and decide whether acting now or waiting makes more sense for your specific situation. Don’t assume the future rules apply today.
If this was useful, you might also want to read what to know about early move-out penalties when renting.
Sources and Further Reading
Renters insurance UK: what you need to know to protect your belongings — If you’re renting, this guide explains how to cover your possessions without overpaying.
Government announces major leasehold reform proposals – Why leaseholders should still rely on today’s law. Anthony Gold, 2026.
Everything you need to know about leasehold reform in 2026. Enact, February 2026.
