What is a leasehold extension?

A leasehold extension is the process of extending the lease term of a property held on a leasehold basis. It helps maintain the property's value and desirability. Leasehold extension legislation allows leaseholders to extend their lease, ensuring the property remains attractive for sale or mortgage purposes.

How long is a leasehold extension ?

The length of a leasehold extension can vary depending on the jurisdiction and specific circumstances. In some countries, such as the United Kingdom, leasehold extensions are typically granted for an additional 90 years beyond the remaining term of the existing lease. However, it's important to note that leasehold extension regulations can differ, and it's advisable to consult local laws or seek professional advice like leasehold valuations for accurate information regarding leasehold extensions in a specific jurisdiction.

What are the benefits of lease extension ?

Extending the leasehold of a property offers benefits such as increased property value, improved marketability, easier access to mortgage financing, peace of mind and security, the avoidance of escalating costs, and more control over property management.

What happens to leasehold property after 99 years ?

After 99 years, the leasehold property typically reverts back to the freeholder, unless the lease is extended by the leaseholder. The ownership of the property, along with the land it is built on, returns to the freeholder once the lease expires. As a lease approaches its expiration, the property’s value may decrease, making it more challenging to sell or mortgage. It is advisable for leaseholders to consider extending their lease well before it reaches the 99-year mark to maintain the property’s value and their ownership rights.

Why choose leasehold Valuations for Lease extension or Buying Freehold ?

1. Fair Price: A leasehold valuation ensures you pay a fair price for a lease extension or freehold purchase.2. Increased Property Value: Extending the lease or buying the freehold can potentially increase your property’s value.3. Cost Savings: Accurate valuation helps minimise future costs like ground rent.4. Stronger Negotiation: A valuation report strengthens your position during negotiations with landlords.5. Legal Compliance: Valuations ensure you meet legal requirements for lease extensions or freehold purchases.6. Future Planning: Valuations help you plan for selling or passing on the property to future generations.7. Expert Advice: Engaging a valuer provides access to their expertise and guidance.8. Mortgage Support: Valuation reports improve your mortgage opportunities for lease extensions or freehold purchases.

How much does it cost to renew a leasehold ?

The cost of renewing a leasehold in the UK can vary depending on various factors, such as the property value, the length of the renewal term, and any negotiations between the leaseholder and the freeholder. Unlike extending a lease, which typically involves paying a premium to the freeholder, renewing a lease generally involves paying a nominal fee known as a “peppercorn rent” or a small percentage of the property value.The exact cost of renewing a leasehold will depend on the specific terms agreed upon between the parties involved. It is advisable to consult with a solicitor or a licenced conveyancer who specialises in leasehold matters to get an accurate estimate of the costs involved based on your particular situation.

Q. How much does it cost to extend a leasehold in uk ?

The cost of extending a leasehold in the UK can range from a few thousand pounds to tens of thousands of pounds, depending on factors such as the remaining lease length, property value, and negotiated terms with the freeholder. Additional costs include legal fees, valuation fees, and disbursements such as Land Registry fees. It’s recommended to seek professional advice for an accurate estimate based on your specific situation.

When Is a Leasehold Reform Bill Expected? Key Updates & Timeline

April 26, 2025

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The leasehold system in the UK has long been a topic of debate, with many homeowners facing issues related to excessive ground rents, costly lease extensions, and restrictive terms. As a result, the government has been working on leasehold reform to create a fairer system. But when is a leasehold reform bill expected to be introduced, and what changes will it bring?

1. Understanding Leasehold Reform

Leasehold reform refers to changes in property laws that aim to improve the rights of leaseholders and simplify the process of extending leases or purchasing freeholds. Over the years, there have been multiple discussions and legislative efforts to overhaul the system and provide leaseholders with more control over their properties.

2. Recent Leasehold Reforms

In recent years, the UK government has introduced various measures to address leasehold issues. The Leasehold Reform (Ground Rent) Act 2022 was a significant step, banning ground rents for new leases. However, existing leaseholders were still subject to ground rents and complex lease extension procedures.

3. When Is a Leasehold Reform Bill Expected?

The Leasehold and Freehold Reform Act 2024 received Royal Assent on May 24, 2024, officially becoming law. This Act introduces several changes aimed at making leasehold ownership fairer and more transparent.

One of the key provisions of the 2024 Act is the abolition of the “two-year rule,” which previously required leaseholders to own their property for two years before applying for a lease extension or freehold purchase. This rule change took effect on January 31, 2025, allowing leaseholders to take action immediately upon acquiring a leasehold property.

In addition to this, the government has announced further reforms that will be introduced in stages. Provisions related to the right to manage, which will allow leaseholders in buildings with up to 50% non-residential space to take control of their building’s management, are expected to be implemented in spring 2025.

4. Future Leasehold Reform Plans

While the 2024 Act addresses several pressing concerns, the government is planning additional reforms through the Draft Leasehold and Commonhold Reform Bill. This bill is expected to be introduced in the second half of 2025, following the publication of a White Paper in early 2025.

The upcoming bill may introduce further protections for leaseholders, including:

Simplified processes for purchasing freeholds
Strengthening rights for leaseholders to challenge unfair fees
Promoting commonhold as an alternative to leasehold

These proposed changes aim to provide long-term solutions and create a more equitable property ownership system.

Also, learn more about Leasehold and Freehold Reform Bill

5. What This Means for Homeowners and Buyers

For current leaseholders, the 2024 Act already brings significant benefits, especially with the elimination of the two-year ownership requirement for lease extensions. Prospective buyers of leasehold properties can also benefit from greater transparency and fewer financial burdens.

However, those waiting for further reforms should stay informed about the Draft Leasehold and Commonhold Reform Bill. As the government prepares to introduce these changes, homeowners and property investors should assess their options carefully, whether extending their lease now or waiting for new legislation to take effect.

Conclusion

The long-anticipated leasehold reform is finally taking shape, with the Leasehold and Freehold Reform Act 2024 already in effect and further legislative changes expected in the second half of 2025. If you are wondering, “When is a leasehold reform bill expected?” The answer lies in these upcoming developments. Keeping an eye on government updates and consulting property experts will be crucial for leaseholders navigating these changes.