Leasehold Reforms: What They Mean for Buyers and Sellers in Wimbledon SW19
The government has unveiled a series of transformative changes to leasehold law that could significantly impact the property (flats) anyone is buying or selling here in Wimbledon, writes Clive Scrivener, Partner at Wimbledon based Chartered Surveyors Scrivener Tibbatts Ltd.
Housing Minister Matthew Pennycook has confirmed ambitious plans to end the “feudal leasehold system” and establish commonhold as the default tenure during the current Parliament, while also introducing major protections for leaseholders. This an interested comment as all Feudal Title was abolished by the Law of Property Act 1925 (nearly 100 years ago). However, as these reforms take shape they promise to reshape how leaseholders buy, sell, and manage properties.
What’s Changing?
The government’s plan includes both immediate and long-term reforms to address historic injustices within the leasehold system:
- Removal of the ‘Two-Year Rule’ (January 2024): Leaseholders will no longer need to wait two years after acquiring a property to extend their lease or buy their freehold. Mark Chick, Director of ALEP, called this a “quick win” for leaseholders, offering much-needed flexibility and enhancing property market accessibility.
- Right-to-Manage Reforms (Spring 2025): New provisions will make it easier for leaseholders in mixed-use buildings to take over management responsibilities. Notably, leaseholders will no longer be required to cover the freeholder’s costs in most claims, removing a significant financial burden.
- Leasehold and Commonhold Reform Bill (Second Half of 2025): This proposed legislation aims to make commonhold the default tenure, eliminating many complexities of the leasehold system.
Pennycook’s Vision
Matthew Pennycook made a clear commitment to transforming homeownership:
“We are determined to tackle the injustices of the leasehold system and to empower homeowners with greater rights and control over their properties. For far too many leaseholders, the reality of home ownership has fallen woefully short of the dream – their lives marked by an intermittent, if not constant, struggle with punitive and escalating ground rents; unjustified permissions and administration fees; unreasonable or extortionate charges; and onerous conditions imposed with little or no consultation. This is not what home ownership should entail.”
Pennycook also reaffirmed the government’s intention to implement the 2019 RoPA recommendations, including regulating property agents and introducing minimum qualifications for managing agents to professionalize the sector.
Upcoming Consultations
Several additional reforms are under consultation and could bring further benefits to leaseholders:
- Building Insurance Commissions: A ban on commissions for landlords, property managers, and freeholders, replacing them with transparent fees.
- Service Charges and Legal Costs: Strengthened leaseholder rights to challenge unreasonable costs.
- Enfranchisement Valuation Rates: A review of how enfranchisement premiums are calculated, potentially reducing costs for leaseholders.
Challenges and Criticism
While the reforms have been broadly welcomed, critics have noted several challenges:
- Shared ownership properties are currently ineligible for 990-year lease extensions.
- The rushed passage of the Leasehold & Freehold Reform Act 2024 has left gaps in the legislation that may require further amendments.
Pennycook admitted that the 2024 Act had “rendered the process of holistic and coherent leasehold and commonhold reform more challenging,” but described the changes as “a necessary set of reforms” to deliver immediate relief to affected homeowners.
What Does This Mean for Wimbledon SW19?
These changes could have a transformative impact on the local property market:
- For Sellers: The removal of the two-year rule will make flats with short leases more appealing to buyers, improving marketability.
- For Buyers: Simplified lease extension processes and reduced enfranchisement costs could make buying a flat less daunting and more financially viable.
The introduction of commonhold is still very much an unknown and but if this become the default tenure for new developments it might offer fairer ownership model.
Expert Reactions
Mark Chick (Association of Leasehold Enfranchisement Practitioners):
“The most important change in this announcement is the two-year rule. It will allow much greater flexibility and access to enfranchisement rights. This is certainly a ‘quick win’ for leaseholders and one significant piece of good news.”
Council for Licensed Conveyancers:
“Professionalisation of managing agents can contribute very significantly to transforming home buying and selling, leading to a faster, more certain, more secure, and less stressful conveyancing process.”
Timothy Douglas (Propertymark):
“It is encouraging that the Minister is looking again at Lord Best’s report and understands the value of qualifications for agents. Propertymark looks forward to continuing to work with the UK Government to extend these requirements widely across the property sector.”
What’s Next?
At Scrivener Tibbatts we will be participating in the consultation and will update you here with any progress being made. With the government pledging swift action to address leaseholder rights, buyers and sellers in Wimbledon should stay informed and consult property experts to understand how these changes may affect them. The reforms promise to create a fairer, more transparent property market and could mark a turning point for leasehold and commonhold in the UK.
If you would like to discuss something related to a property valuation please contact Clive Scrivener direct via email at Clive@scrivenertibbatts.co.uk or call 020 8971 2983.
