The landscape of English property law is shifting. On 27 January 2026, the UK Government unveiled the draft Commonhold and Leasehold Reform Bill, a landmark piece of legislation designed to dismantle an "outdated and unfair" system.
This new Bill is intended to replace or significantly overhaul the Commonhold and Leasehold Reform Act 2002.
A consultation period is in place until April 2026. For millions of homeowners, this represents the most significant change to property tenure in a generation.
At Lawcomm Solicitors, we understand that these headlines can be both exciting and confusing. Whether you are a current leaseholder, a prospective buyer, or a developer, here is what you need to know about the forthcoming transition.
One of the most immediate concerns for leaseholders has been escalating ground rents. The new Bill targets this "cost-of-living" pressure directly:
• The £250 Cap: Ground rents for existing properties will be capped at £250 per year.
• The Path to Zero: Under the proposed regime, ground rent will eventually convert to a "peppercorn" (zero) after 40 years.
• Timeline: The government anticipates these caps will take effect in late 2028.
This is a game-changer for those currently "trapped" in properties with onerous rent terms that make selling or remortgaging nearly impossible.
The government is moving to make Commonhold the default tenure for flats.
• The Ban: Once the reformed model is active, the sale of new-build leasehold flats will be banned.
• Collective Control: In a commonhold, residents collectively own and manage the building. This eliminates the traditional landlord-tenant friction, giving you the power to set budgets and service charges.
• Easier Conversion: For those already in leasehold flats, the Bill proposes reducing the consent threshold for conversion—meaning you may no longer need 100% of your neighbours to agree to make the switch.
For too long, the threat of forfeiture—where a resident could lose their entire home over relatively small debts—has hung over leaseholders. The Bill seeks to abolish this draconian measure, replacing it with a fairer enforcement regime that protects your investment while ensuring service charges are handled reasonably.
It isn't just flat owners who benefit. The Bill proposes to repeal harsh enforcement powers related to estate rentcharges on freehold houses. This protects homeowners from heavy-handed tactics by third-party management companies on modern estates.
While these reforms are a potential victory for consumer rights, they are also complex. Industry voices have raised concerns about how these retrospective changes will affect existing contracts and the wider investment market.
As the Bill moves through Parliament, there is likely to be further provisions regarding:
• Lease extensions and transition arrangements.
• Transparency requirements for managing agents.
• Legal thresholds for converting to commonhold.
While the 2026 Bill is in its initial consultation phase, the implementation of the remaining provisions of the Leasehold and Freehold Reform Act 2024 will continue.
The "beginning of the end" for the leasehold system is possibly here, but the journey to a new tenure requires expert legal guidance. Whether you are looking to extend your lease or are interested in exploring a collective conversion to commonhold, our specialist ALEP accredited leasehold property team are here to protect your interests.
For further information regarding leasehold law, please do not hesitate to contact Mr Bill Dhariwal (E: bill.dhariwal@lawcomm.co.uk) or Mrs Vaishnavi Komandur (E: vaishnavi.komandur@lawcomm.co.uk)
Law is correct as at date of publication. The contents of this article do not constitute legal advice.
