National Conveyancing Month: What’s happening to the leasehold system?
National Conveyancing Month: What’s happening to the leasehold system? We look at the potential changes announced so far
Major reform of the ‘feudal’ leasehold system in England and Wales is on the way with ministers pledging to end the current system and overhaul how people own their homes and communal areas.
Most flats are currently leasehold. However, where they have rising ground rents and high service charges, they can be harder to sell and mortgage lenders have been reluctant to lend. As a result, property prices have been affected.
This reform aims to remedy the situation.
What are the key leasehold and commonhold changes under consideration?
The draft Leasehold and Commonhold Reform Bill includes plans to:
- Ban the sale of new leasehold flats.
- Insist housing developers sell all new flats on a commonhold basis.
- Cap ground rents at £250, falling away to effectively nothing after 40 years.
- Give existing leaseholders the opportunity to convert to commonhold (where neighbours collectively own the ground their flats are built on as well as the building itself).
- Allow homeowners greater control over how their buildings are managed.
- Make it easier to understand and challenge service charges.
Why is this reform needed?
Campaigners believe the current system is unfair. Most flats in England and Wales are leasehold which means the owners effectively buy the right to live in a property for a fixed period of time.
Almost four million of these owners still have to pay ground rent, a fee paid by the leaseholder for the land under their buildings as part of the terms of their lease.
Sometimes, the ground rent will start off at a reasonable level but then double every 10 years making the sum payable increasingly extortionate and making it difficult to sell or get a mortgage.
In addition, leaseholders have less control over their property costs than freeholders, who generally own the building and the land on which it is built, outright and forever.
This includes spiralling service charges for leaseholders for the cost of maintenance and repairs.
What do our conveyancing experts think of these changes?
Whilst welcoming the long overdue reform of the outdated leasehold system, our expert Conveyancing Team do not think any changes are likely to happen until at least 2028.
There is no way of knowing, at this stage, whether these reforms will reflect the bill in its current format or undergo changes. However, it is likely the main changes to ban new leasehold flats, make commonhold the default housing tenure and capping ground rents will all stand.
We’ll keep you posted on everything you need to know as the bill makes its way through parliament.
Get in touch
Wards Solicitors wins high praise in the 2026 edition of the independent Legal 500 guide of outstanding legal professionals for its exceptional professional service standards and high levels of technical expertise.
Our expert and highly regarded Conveyancing Team works across all 13 of our local offices in Bristol, South Gloucestershire, Bath and North East Somerset and North Somerset.
National Conveyancing Month runs from 2 to 31 March and is aimed at raising the profile of conveyancers and providing a crucial insight into every aspect of their role in the house buying process