The Commonhold And Leasehold Reform Bill: What Will It Mean In Practice?

Prime Minister Andy Burnham first committed to leasehold reform in his first appearance at the Commons despatch box as Prime Minister. He promised to “reform this unfair system”, framing it as a cost-of-living issue, and saying he was looking at “where people face unfair charges that they can’t avoid”.  The Housing Secretary, Angela Rayner, went even further, describing the problem as a “scandal faced by millions of leaseholders who have found their dream of homeownership turn into a nightmare”.

Changes initially promised pursuant to the Leasehold and Freehold Reform Act 2024 are still being implemented slowly (and somewhat unevenly), leaving plenty of room for additional legislation seeking to improve matters further.

The draft Commonhold and Leasehold Reform Bill was published in January 2026 under Sir Keir Starmer and was included in the King’s Speech.  However, the proposed reforms continue to be delayed, and the draft Bill has still not been formally introduced to Parliament.

The key changes proposed by the draft Bill include:

• Replacement of leasehold with commonhold as a form of tenure (the Bill would also make it easier for existing leaseholders to switch to commonhold)
• New protections against unfair ground rent charges
• Caps on a range of fees charged to leaseholders and to homeowners on privately managed estates, including fees for consents (i.e. alterations or keeping pets), administration and providing documents
• Regulating managing agents should improve how buildings are run

It is estimated that between 2.6 million and five million leasehold households could be affected by the proposed changes.

The commitment should be good for leaseholders and boost buyer confidence, but implementation will take time, as seen already with the 2024 Act.  In addition, mortgage lenders will inevitably introduce new lending criteria against commonhold properties which may make obtaining mortgage finance on such properties more challenging.

Under a commonhold structure, each owner holds the freehold of their own unit with no time limit. The building is run collectively by the owners, and there is no separate landlord. Homeowners are expected to welcome the option to own under a commonhold structure, as it removes the requirement to pay ground rent, the shrinking lease and the landlord-controlled charges that cause most complaints about leasehold ownership, but it also brings new responsibilities and practical problems (particularly in terms of day to day management of the building and common areas) that the new Bill will need to address.

Whilst, for most homeowners, commonhold should be an improvement, the previous effort to introduce commonhold as a replacement for leasehold tenure (under the Commonhold and Leasehold Reform Act 2002) proved unsuccessful.  Whether the proposed Bill is likely to work in practice will depend on the detail of the Bill – which remain to be seen.