The Commonhold Reform Bill 2026 Explained: Q&A Guide

The Government published its Commonhold and Leasehold Reform Bill in January, when the Prime Minister took to TikTok to announce a cap and the eventual phasing out of ground rent. The Housing, Communities and Local Government Select Committee has launched its pre-legislative scrutiny of the Bill and then it will make its way through Parliament.

Specialist property litigation lawyer Tom Baylis and Paralegal Amelia Sharples answer some questions about the Bill.

Q. What is a leasehold title?

• ’Leaseholder’ is the term referring to an individual who owns a property for a fixed period of time, for example, 99 years. This is known as a ‘leasehold title’.
• The land is owned by the freeholder (landlord), to whom the leaseholder typically pays ground rent and service charges.

Q. What is a commonhold title?

• Unlike with a leasehold title, which is for a prescribed period of time, commonhold provides individuals with the security of outright ownership of their property.
• If the property is a flat, individuals own their units and acquire shared responsibility to maintain communal areas (hallways and gardens) through a commonhold association. 

Q. What is the Commonhold Reform Bill 2026?

• The Commonhold Reform Bill presents a major overhaul of residential property law, aiming to make commonhold the default tenure for new developments (replacing leaseholds).
• The proposals are designed to establish a fairer, more transparent system, giving homeowners greater control over their property and limiting the unfair practices of landlords and estate administrators.
• It is important to note that the Bill is still under parliamentary scrutiny, requiring approval and secondary legislation prior to its full implementation.

Q. What are the main reforms proposed by the Bill?

The Bill establishes key changes in a number of areas:

• Ground rent reform
• A ban on new leasehold flats
• Statutory right for existing leaseholders to convert their property to a commonhold
• Restrictions upon harsh enforcement powers and forfeiture
• Increased clarity surrounding service charge and estate costs
• Stronger protections for homeowners on private freehold estates (‘fleeceholds’)

Q. How will ground rents change?

• Existing long residential leases will have ground rent capped at £250 per year, which will then reduce to a ‘peppercorn’ (effectively zero) after 40 years.
• The cap applies to leases not already covered by the Ground Rent Act 2022, with exceptions for certain business leases, home finance plans and community housing arrangements. The Ground Rent Act abolished ground rent on most new leasehold properties in England and Wales.

Q. When will the ground rent cap take effect?

• It is estimated that the cap will come into force in late 2028, once the Bill has received Royal Assent and supportive legislation is enacted.
• Until then, disputes concerning ground rent are likely to continue under the current legislative frameworks.

Q. Will new leasehold flats be banned?

• Yes. The Bill proposes a ban on new leasehold developments which moves towards commonhold as the default tenure.
• The government consultation, ‘Moving to commonhold’ runs from 27 January 2026 to 24 April 2026, after which the ban is expected to be phased in on a gradual basis.

Q. Can existing leaseholders convert to commonhold?

• Leaseholders have a statutory right to convert; however, it is not automatic and must be actively exercised.
• Current frameworks stipulate that 100% of qualifying leaseholders must agree to the conversion. However, the Bill reduces this to 50% which should make conversion easier in practice.
• Additional transitional rules account for mixed-tenure buildings and will address management powers, voting rights and financial responsibilities.

Q. Is forfeiture being abolished?

• The Bill sets to restrict the use of forfeiture, the longstanding process allowing landlords to repossess a property for unpaid charges.
• Sections 121 to 122 of the Law of Property Act 1925 (estate rent charges) will be repealed.
• Enforcement will instead follow a more proportionate, court-based process.

Q. How are ‘fleecehold’ estates affected?

·       Fleecehold estates are freehold properties in which individuals pay mandatory estate charges to private management companies.

The Bill aims to:

• Reduce dependence and powers of private estate managers
• Remove harsh enforcement powers for unpaid charges which historically have exceeded the cost of the ground rent some in the region of £350 per year. One Labour MP said homeowners are paying twice, Council Tax and ‘fleecehold’.
• Make it easier for homeowners to take control of their home/estate

Q. When will the reforms take place?

Implementation will be a phased process:

• Forfeiture and rent charge enforcement reforms are expected shortly after Royal Assent
• Service charge transparency reforms will occur on a staggered basis
• Commonhold conversion rights will be introduced later via secondary legislation
• Ground rent reforms are expected to come into force late 2028

Q. Why is legal advice important?

The Bill represents a major shift in residential property law, and early advice can help both leaseholders and landlords:

• Protect interests during the transitional period
• Handle enforcement and arrears disputes effectively
• Navigate commonhold disputes and to exercise statutory rights
• Address service charge and estate charge issues
• Early legal advice can reduce risk, prevent costly disputes and provide clarity and compliance as the new regime comes into force