Matthew Pennycook, Minister of State for Housing and Planning, made the announcement on X (formerly Twitter).
He wrote: “The work continues to switch on the measures in the Leasehold and Freehold Reform Act. I have today signed regulations to remove the two-year ownership rule for leaseholders of flats to extend their lease, and leaseholders of houses to extend their lease or buy their freehold.
“This change will come into force at the end of this month, giving leaseholders the flexibility to make a claim immediately upon buying a leasehold property, and reducing their costs as a result.”
Previous legislation required leaseholders to have owned the property for two years or more before they could extend their lease or buy the freehold to their home.
The move was welcomed by the National Leasehold Campaign (NLC). The campaign group was created by campaigners in 2017 after thousands of people who bought leasehold houses discovered they were trapped by unfair leasehold arrangements.
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A statement from the NLC said: “Today’s news is a significant step forward and follows the ministerial leasehold statement in November, where the Government reaffirmed their determination to honour Labour’s manifesto commitments to finally bring the feudal leasehold system to an end. This is the first action to be delivered.
“Whilst we welcome today’s action, there is still a long way to go to deliver the promises leaseholders desperately need and deserve. Without the valuation section of the Leasehold and Freehold Reform Act (LAFRA) 2024 being switched on, many leaseholders remain in a state of ‘leasehold limbo’. They still won’t be able to afford the overinflated premiums and legal fees to buy their freehold or extend their lease.
“We urge the Government to expedite the valuation part of the act so that leaseholders can enfranchise (buy their freeholds) or extend their lease quicker, easier and cheaper. This is what millions of leaseholders and the 30,000 members in the NLC are waiting for. Time is running out as, in the meantime, leaseholders remain at the mercy of freeholder investors who continue to fleece tenants through extortionate charges trapping them in a system they cannot afford to get out of.”
Linz Darlington, managing director of lease extension specialist Homehold, also welcomed the move, but pointed out that leasehold reform still has a long way to go.
He said: “While this is a welcome development, removing the ownership condition is a drop in the ocean in terms of what is needed from leasehold reform. It is a small change [that] will benefit a small proportion of leaseholders.
“We estimate that hundreds of thousands of leaseholders are waiting for the more significant changes to the lease extension regime, which have been promised to make it ‘cheaper and easier’ for them to extend their leases.
“The Leasehold and Freehold Reform Act 2024 has already set out these changes, but they are not yet in force. Despite this legislation receiving royal assent in May 2024 – now eight months ago – the Government intends to run a further consultation on some of the important provisions. They don’t intend to run this consultation until the summer, and this creates a further delay, which is unwarranted and unwelcome.
“For leaseholders waiting for leasehold reform, they have now had successive Governments promise reforms [that] always seem tantalisingly close, but never actually seem to arrive. We need the Labour Government to bring forward the consultation, and commit to swiftly implementing the legislation.”
