Reform must now move from principle to delivery
The Committee’s report reinforces many of Propertymark’s key campaign positions. Leaseholders need faster action on unfair costs, clearer rights to take control of their homes, and proper regulation of the professionals who manage buildings.
Commonhold reform will reshape the sale, purchase and management of flats in England and Wales. The final legislation must be clear, workable and supported by guidance, training, reliable data, and properly resourced public bodies.
Propertymark will continue to engage with policymakers as the Bill progresses to ensure the final reforms support a fair, transparent and efficient property market for consumers and the professionals who serve them.
Ground rent cap must deliver faster relief
Current plans include a cap on ground rents at £250 per year, before reducing them to a peppercorn after 40 years. Echoing Propertymark’s campaigning, the Committee welcomes the cap, but questions why leaseholders should have to wait four decades for ground rents to fall to zero. The UK Government must provide further evidence to justify the 40-year transition and explain why a shorter 20-year period could not strike a fair balance.
The Committee also recommends that the £250 cap should come into force in 2027, one year earlier than the current UK Government timeline. Additionally, the cap must not allow ground rents that are currently below £250 to rise to that level where no escalation clause exists.
Our research has shown that this matters to agents and consumers. 78% of agents said leasehold properties with escalating ground rent would struggle to sell, even if priced correctly.
Regulation of managing agents must be included
We are very pleased to see the Committee add its voice to our long-standing call for statutory regulation of property managing agents.
The report states that failing to include provisions to regulate property managing agents is a significant shortcoming in the draft Bill and recommends that an independent regulator should be introduced for property managing agents, with enforcement powers including the ability to issue fines and revoke licences where agents breach a statutory Code of Practice.
Propertymark has long campaigned for the implementation of the Regulation of Property Agents working group recommendations, including mandatory qualifications, a Code of Practice and a licensing system. Regulation should sit alongside leasehold and commonhold reform so consumers can have confidence in the professionals advising them and managing their buildings.
This will become even more important if commonhold becomes the default tenure for new flats. Many commonhold associations are likely to appoint professional managing agents to run buildings day to day, especially in larger or more complex blocks. Clear standards, qualifications and enforcement will be essential to support residents and protect confidence in the new system.
Remaining Law Commission reforms should not be delayed
The UK Government should enact the remaining Law Commission recommendations on enfranchisement and Right to Manage during this Parliament. The Committee recognises that these reforms are needed to make collective enfranchisement cheaper and easier, which would help more leasehold blocks convert to commonhold.
Our member feedback has repeatedly highlighted high lease extension costs, difficulty obtaining information from management companies, and the need for clearer processes and rights for acquiring the freehold.
Land Registry must modernise
Because a commonhold is only formally recognised once it is registered, delays or outdated systems could slow the transition and undermine confidence in the new tenure. HM Land Registry (HMLR) already has a backlog in non-urgent applications and is still operating with legacy systems, despite plans for greater digitisation and automation.
The UK Government must invest in making HMLR’s systems more digital, accessible and user-friendly so it can handle increased demand as commonhold becomes more widespread. Failure to modernise those systems poses a risk to the successful implementation of leasehold reform.
Commonhold must be workable in practice
Under the draft Bill, leaseholders would first need to agree to collective enfranchisement and then separately agree to convert to commonhold. The Committee says this two-step process could become a barrier and recommends that conversion to commonhold should become the default outcome of collective enfranchisement, while allowing leaseholders to opt out through a 50% vote.
Propertymark supports efforts to make commonhold a more realistic option, but we have stressed that the transition will need clear guidance, practical support and enough time for the sector to prepare. Commonhold will bring new documents, governance arrangements, information certificates and registers, and agents, buyers, lenders and managing agents will all need confidence in how the system works.
Service charges and building safety remain central concerns
While ground rents have received significant attention, service charges are often a bigger barrier to leasehold sales. High, unclear or unpredictable charges can deter buyers, slow transactions, and reduce confidence in leasehold property. Charges should reflect the real cost of maintaining buildings and be presented clearly so residents understand what they are paying for.
Building safety must also remain part of the wider reform programme. Many leaseholders are still unable to sell or remortgage because of unresolved safety defects, while others face increased insurance costs. Leasehold and commonhold reform will not deliver full confidence in the market unless these wider pressures are addressed.
Leasehold properties
We've been working with the National Leasehold Campaign to raise awareness of the abuse of the leasehold system in newly built homes.
