If you own a flat in England or Wales, the ground beneath your home — legally speaking — is about to change. After years of promises, the government has set out the biggest shake-up of flat ownership in a generation: a cap on ground rents, a ban on new leasehold flats, and a new default system called commonhold. Here is what leasehold reform 2026 actually proposes, what is already law, and what you should — and should not — do about it yet.
What is being proposed in leasehold reform 2026?
The draft Commonhold and Leasehold Reform Bill, published on 27 January 2026, proposes four headline changes. First, ground rents on most existing long residential leases would be capped at £250 a year, then fall to a peppercorn (effectively £0) after 40 years. Second, the sale of new leasehold flats would be banned in most cases, with commonhold becoming the default tenure for new flats. Third, it would become easier for existing leaseholders to convert to commonhold, with the agreement threshold falling from unanimous consent to 50% of qualifying leaseholders. Fourth, forfeiture — the landlord’s power to take back a home over a breach of the lease — would be abolished and replaced with a court-based enforcement scheme.
What is commonhold, in plain English?
Commonhold is a freehold-based way of owning a flat. You own your flat outright, and you and your neighbours jointly own and manage the shared parts of the building — hallways, roof, gardens — through a commonhold association. There is no third-party landlord holding a superior interest, and no lease ticking down towards zero. It has existed in law since 2002 but has barely been used, largely because converting required every leaseholder to agree. The new Bill is designed to fix that.
What is already law — and what is not yet law?
This is the part that trips people up. The Leasehold and Freehold Reform Act 2024 is already law, but many of its measures are not yet in force. What has happened so far: since early 2025, flat owners no longer need to have owned for two years before extending a lease, and the right to manage has been extended to more mixed-use buildings.
The cheaper lease extensions and 990-year standard extension terms in the 2024 Act have not yet been implemented. Likewise, the 2026 Bill’s ground rent cap and ban on new leasehold flats are proposals at the pre-legislative scrutiny stage — they are not law yet, and the cap is not expected to take effect until late 2028 at the earliest, after Royal Assent and further regulations.
What about ground rent right now?
If you already own a leasehold flat, nothing changes overnight. Ground rent on most new leases has already been banned since June 2022 under the Leasehold Reform (Ground Rent) Act 2022. For older leases with doubling or escalating ground rents, the proposed £250 cap would be a major relief — but until the Bill becomes law, your lease terms still stand. That matters for selling and remortgaging: some lenders remain cautious about leases with onerous ground rents, so get advice before assuming a future cap solves a present problem.
Should you extend your lease now, or wait?
There is no one-size answer, and this is general information, not legal advice. Extending now gives certainty, but you could pay under today’s valuation rules when cheaper rules may arrive later. Waiting could save money if reforms land, but reforms can also slip — and a short lease (under 80 years) can already make a flat hard to sell or mortgage. If your lease is approaching 80 years, or you are trying to sell, speak to a specialist leasehold solicitor before deciding. If your lease is long and your ground rent is a peppercorn, there is usually far less urgency.
What about “fleecehold” houses?
The reforms are not only about flats. In September 2026 the government also announced a Bill to be introduced before Christmas that would cap administration and permission fees charged to freehold homeowners on private estates — the so-called fleecehold problem, where estate charges for roads and shared spaces have risen sharply. If you own a freehold house on a managed estate, that is a separate reform to watch.
What to watch next
Three dates matter: the formal introduction of the Commonhold and Leasehold Reform Bill, expected before Christmas 2026; the government’s lease extension valuation consultation; and the wider leaseholder protections announced in July 2026, including clearer service charge information, most of which are expected from 2027. We will update this guide as each step becomes law.
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