The UK Government’s progress on leasehold reform has slowed significantly despite earlier promises to expedite changes, leaving many leaseholders frustrated and facing continued challenges. Here’s a breakdown of the current situation:

Key Developments and Delays

1. Leasehold and Freehold Reform Act 2024:
   • Passed six months ago but not fully implemented due to identified flaws.
   • Housing Minister Matthew Pennycook cited “serious flaws” in the Act that require rectification through primary legislation before full implementation.
2. Key Upcoming Changes:
   • January 2025: Removal of the “two-year rule,” allowing leaseholders to extend leases or buy their freehold immediately after purchase.
   • Spring 2025: Introduction of enhanced “right to manage” provisions, reforming access, costs, and voting rights.
3. Further Consultations:
   • The Government announced another consultation, delayed until summer 2025, to address:
     • Valuation rates for lease extensions.
     • Legal fees and service charges.
   • Additional legislation will be required to implement these changes.

Concerns from Stakeholders

1. Leaseholders:
   • Many feel trapped in unsellable or unremortgageable properties due to legislative delays.
   • The National Leasehold Campaign criticized the Government’s slow progress and stressed that delays or watering down recommendations would be unacceptable.
2. Industry Experts:
   • Linz Darlington (Homehold):
     • Criticized the piecemeal implementation of reforms, arguing that changes like 990-year lease extensions and removal of freeholders’ legal cost obligations could be enacted immediately.
     • Suggested the delays may be linked to ongoing legal challenges by freeholder groups alleging human rights infringements.
3. Professional Bodies:
   • Propertymark: Welcomed the review of Lord Best’s 2019 recommendations on regulating managing agents and supports professional qualifications for property agents.

Challenges to Progress

1. Litigation by Freeholders:
   • Seven freeholder groups have filed legal proceedings, potentially slowing reforms further.
   • The Government may be awaiting the outcome of this litigation before advancing certain measures.
2. Complications in Legislation:
   • The need for primary legislation to address flaws in the 2024 Act.
   • Balancing leaseholder protections with freeholder rights under human rights law.

Calls for Immediate Action

• Stakeholders are urging the Government to implement uncontroversial reforms without delay, including:
  • Enabling 990-year lease extensions.
  • Abolishing leaseholders’ obligation to cover freeholders’ legal and valuation fees.
  • Conducting consultations sooner to maintain momentum on more complex reforms.

Future Outlook

• The Government has promised a new draft bill next year, potentially broadening reforms beyond the 2024 legislation. However, this may detract from addressing the immediate needs of leaseholders under the current Act.
• Strengthening the regulation of managing agents remains a priority, with renewed consideration of the 2019 Lord Best report.

Leaseholders, campaign groups, and industry professionals will closely monitor the Government’s next steps, and further delays could damage confidence in the Labour administration’s ability to deliver on its promises.