Residential Real Estate
Claire Allan, Oliver Corbally
February 2025
Effective from 31st January 2025, the Government has enacted a major change under the Leasehold and Freehold Reform Act 2024 (LAFRA), which abolishes the two-year ownership rule. This is the first part of the LAFRA to be implemented.
Following this change, Leaseholders will no longer need to wait two years to commence enfranchisement or lease extension processes.
This will have a particular impact on lease extensions or enfranchisement where the flat is subject to an impending sale. Given that new owners will no longer have to wait 2 years to extend their lease or commence enfranchisement proceedings, this will avoid the need for the existing owner to begin this process prior to the sale, if it is required, making the sale process more efficient.
Housing Minister Matthew Pennycook has emphasised this reform marks the initial step towards a comprehensive overhaul of the leasehold system, indicating that efforts will continue to implement the measures outlined in the Leasehold and Freehold Reform Act.
The implementation of further reforms set out in the LAFRA are planned for Spring.
The updated legislation can be seen here – Leasehold and Freehold Reform Act 2024
Practice guide 27 has now also been updated to reflect this:Â Practice guide 27: the leasehold reform legislation – GOV.UK
