By Emily Ransome-Farmer MTPI AssocRICS, Head of Property Management at Watsons Property
Ground Rents Capped, Commonhold Coming... Here's What Leaseholders Need to Know
The King’s Speech on the 13th May 2026 confirmed what many in the property sector had been anticipating: sweeping reforms to England and Wales’ leasehold system are officially on the legislative agenda. For the millions of leaseholders across the country, and for those of us working in property management every day, this is an important moment.
Here at Watsons, we’ve been closely following the progress of leasehold reform and want to help you understand what these changes could mean for you.
What Was Announced in the King’s Speech?
The centrepiece of the housing announcements was the Commonhold and Leasehold Reform Bill, which the Government confirmed will be brought before Parliament. The Bill has been in draft form since January 2026 and has been undergoing scrutiny by the Housing, Communities and Local Government Select Committee.
The key proposals include:
- Capping ground rents at £250 per year, automatically reducing to zero (a ‘peppercorn’ rate) after 40 years
- Banning new leasehold flats, with commonhold set to become the default tenure for new-build flats in England and Wales
- Strengthening leaseholders’ rights to extend their lease or buy their freehold more cheaply and easily
- Abolishing forfeiture — landlords will no longer be able to seize a flat over unpaid debts, replaced by a statutory lease enforcement scheme
- A new right for leaseholders in flats to request improvements such as a gigabit-capable broadband connection
- Greater transparency around service charges and management fees
A separate Building Safety Remediation Bill was also announced, introducing a 2029 deadline for the removal of high-risk cladding from all high-rise buildings over 11 metres, with construction product manufacturers required to contribute toward remediation costs.
What Is Commonhold and Why Does It Matter?
One of the most significant shifts in the Bill is the move toward commonhold as the default way to own a flat. But what does that actually mean?
Under the current leasehold system, you own your flat for a fixed period — the length of your lease — after which ownership reverts to the freeholder. Under commonhold, you own your flat outright and permanently, with no lease expiry, no lease extension costs, and no third-party landlord. You and your fellow flat owners jointly own and manage the shared areas of the building through a commonhold association, in which every owner has an equal vote.
Commonhold has technically existed in England and Wales since 2002, but has rarely been used in practice. The Government’s ambition is to make it the new normal.
What Does This Mean for Leaseholders Right Now?
It’s important to be clear: these reforms are not yet law. The Bill still needs to pass through Parliament and is not expected to come into full effect until around 2028 at the earliest. The ban on new leasehold flats may take even longer to implement, with Housing Minister Matthew Pennycook acknowledging in April 2026 that it is unlikely to be switched on within this Parliament.
That said, the direction of travel is clear and the reforms enjoy cross-party support, meaning leaseholders can plan with growing confidence that change is coming.
What Our Experts Say
“These reforms represent the most significant shift in property ownership law we’ve seen in a generation. For leaseholders, the ground rent cap alone will make a meaningful difference to household finances, and the strengthened rights around lease extensions will give people far more control over their homes. Our advice is to stay informed, understand your current lease terms, and speak to a professional before making any decisions.”
— James Laughlin, Chartered Surveyor & Leasehold Expert, Watsons Property Group
“From a property management perspective, the transition to commonhold will require careful planning, both for managing agents and for leaseholders themselves. The way buildings are run will change fundamentally, and it’s vital that residents are well-prepared. At Watsons, we’re already thinking about how we support our clients through this transition, and we’ll be keeping everyone updated as the legislation progresses.”
— Shelley Philbrock, Senior Property & Compliance Manager, Watsons Property Group
What Should Leaseholders Do Now?
While you don’t need to take immediate action, there are some sensible steps worth taking:
- Review your current lease — understand your ground rent obligations, lease length and any service charge arrangements
- Consider whether to extend your lease — if your lease is approaching 80 years or below, it’s worth seeking advice sooner rather than later, as costs can increase significantly below this threshold
- Stay informed — the legislation is still progressing and details may change. Bookmark the Government’s leasehold reform updates for the latest news
- Speak to a specialist — whether you’re thinking about extending your lease, buying your freehold, or simply want to understand your rights, our team is here to help
How Watsons Can Help
At Watsons Property Group, our Block and Estate Management team works with leaseholders and residents’ associations to ensure buildings are well-managed, transparently run, and fully compliant with current legislation.
As the leasehold landscape changes, we’ll be on hand to guide you through every step. From understanding your current position to navigating the transition to commonhold when the time comes.
Get in touch with our team today to discuss your property management needs.
Further Reading
- Commonhold and Leasehold Reform Bill — UK Parliament
- HomeOwners Alliance: Leasehold Reform Latest News 2026
- NRLA: King’s Speech puts the focus on leasehold and social housing
Watsons Property Group is a leading property management and surveying firm based in Norwich, Norfolk. For expert advice on leasehold matters, block management or property surveys, contact our team today
