Property Expert Welcomes UK Leasehold Modernisation as Major Positive for Industry

A leading property expert at national chartered surveyor Bruton Knowles, is welcoming the UK’s update to its leasehold system in England and Wales.

Dorian Wragg, Head of Commercial Property and Partner at the surveyor, says the landmark reform, which aims to address longstanding concerns from leaseholders about excessive service chargers and limited property rights, is a positive step forward.

Housing Minister Matthew Pennycook has demonstrated a commitment to ending the feudal-era system, which will impact 5 million homes in England, before the end of this parliament in 2029.

Pennycook had previously stated that abolishing leasehold would have a “lasting, generational impact”, going on to describe the system as “inherently unfair” for leaseholders.

Dorian says the proposed changes couldn’t come sooner and will empower leadesholders: “This is an extension of the general thrust of government policy over the last three decades, with the intention of modernising the centuries-old feudal land-holding system and favouring leaseholders.

“Of course, there have been plenty of changes over the years to slowly enact changes to the leasehold system, as it stood.

“The Leasehold Reform, Housing and Urban Development Act 1993 (as amended) enable a qualifying tenant, one with a remaining lease term of more than 21 years, to join with the leaseholders of other flats in a building to join together and buy the freehold of that building – empowering owners of short leaseholds to extend the term of their leases.

“The Commonhold and Leasehold Reform Act 2002 introduced commonhold, a new way of owning land based on the Australian and American models, while the Leasehold Reform (Ground Rent) Act 2022 ended ground rents for new long residential leases.

“And then the Leasehold and Freehold Reform Act 2024 – followed on from the 2022 Act and improved the transparency over service charges, giving leaseholders a new right to request information about service charges and the management of their building, administration charges and landlords commission on building insurance policies. It also extended the standard lease term to 990 years and gave leaseholders the right to extend their leases, buy their freeholds and take over the management of their building.”

Whilst the modernisation of the existing leasehold system has been a long-time coming, as Dorian says, it will be of great interest to see how the reform is used in reality: “That this Act grants leaseholders increased powers is a great move for them, but it whether many will want to utilise these powers or not will be worth watching.

“It is hand in hand with the changes that Building Safety Act and the Fire Safety Act have undergone, which makes significant persons personally responsible for the management of health and safety matters in the buildings.

“The implications of self-management are significant and, where fault is found, it will have direct implications for those people managing residential buildings. The risk of non-conformance to statutory legislation in the wake of Grenfell may ultimately deter leaseholders from the self-management of buildings.”