Leasehold and Freehold Reform Act Compliance Check

Why this matters

The Leasehold and Freehold Reform Act 2024 is being brought into force in phases, and freeholders, managing agents and landlords who haven’t kept pace risk falling foul of rules that are now live rather than pending. Key provisions already in effect include the ban on freeholders and managing agents taking commission on buildings insurance — replaced with a transparent, fair handling fee that must be disclosed to leaseholders — and the removal of the two-year ownership qualification period that previously stopped new leaseholders extending their lease or buying their freehold. Standard lease extensions now run to 990 years with ground rent reduced to a peppercorn, and the Right to Manage non-residential floorspace threshold has been raised from 25% to 50%, opening Right to Manage claims to buildings with more shops, offices or other commercial units than before.

Other provisions are still moving, which makes this an area to keep checking rather than tick off once. The abolition of “marriage value” from lease extension and enfranchisement premium calculations has faced legal challenge from freeholder groups, creating real uncertainty over how premiums already agreed or in progress should be calculated. Standardised, transparent service charge demands and annual accounts are being introduced through further secondary legislation, and a separate consultation on capping or reducing ground rents on existing long leases could bring further legislation. A freeholder, managing agent or landlord that assumes the Act is “done” risks continuing insurance commission practices that are now banned, miscalculating premiums, or mishandling a Right to Manage claim that would previously have failed on the floorspace test.

What you'll need

• Whether your business owns freehold interests in residential leasehold buildings, or acts as a managing agent
• Whether you charge, collect, or receive commission on ground rent, service charges, or buildings insurance from leaseholders
• Whether any leaseholders have requested a lease extension, freehold purchase, or Right to Manage since the reforms began
• Whether your service charge demands and accounts follow the new transparency requirements

What you'll get

A personalised compliance report covering: a score out of 100, an executive summary, a list of findings ranked by severity, and a prioritised action plan with timeframes.