The End of Leasehold? How to Use the 2026 Reform Bill to Secure a 990-Year Extension

For decades, the UK’s leasehold system has been criticised as a "feudal" remnant that leaves homeowners at the mercy of escalating ground rents and dwindling lease terms. However, the tide is turning. The implementation of the 2026 Leasehold Reform Bill UK (following the Leasehold and Freehold Reform Act 2024) marks the most significant shift in property law for a generation.

If you are a leaseholder, these changes mean you no longer have to settle for a 90-year top-up. Instead, you can secure your home’s future with a 990-year lease extension. Here is how the new legislation works and how you can benefit.

What is the 2026 Leasehold Reform Bill UK?

The reform is designed to make it "cheaper and easier" for people to extend their leases or buy their freeholds. While the Act was passed in 2024, the full administrative framework and new valuation calculators are expected to be fully operational by 2026.

Key changes include the removal of the "two-year rule," which previously required you to own a property for two years before being eligible to extend the lease. Now, leaseholders can start the process from day one of ownership.

The Shift to a 990-Year Lease Extension

Under the old system, most flats were entitled to a 90-year extension, while houses were entitled to 50 years. The 2026 reforms standardise this to a 990-year lease extension for both houses and flats.

This massive increase effectively turns the lease into a "virtual freehold." It removes the need for future generations to worry about the lease running down, which significantly protects the property's resale value. Furthermore, as part of the extension process, your ground rent will be reduced to a "peppercorn" (zero) rate.

Ground Rent Reform: Saving Money for Homeowners

One of the most predatory aspects of the current system is doubling ground rent clauses. The new ground rent reform aims to cap these costs. For those extending their lease under the new Bill, the requirement to pay any further ground rent is abolished.

Even for those not immediately extending, the government has introduced measures to ensure that ground rents do not become an insurmountable financial burden, making it easier for leaseholders to sell or remortgage their homes.

Leasehold vs Freehold UK: Which is Better Now?

In the debate of leasehold vs freehold UK, the gap is finally narrowing. Historically, freehold was vastly superior because the owner held the land and the building indefinitely.

With the 2026 reforms:

• Leaseholders gain 990-year security and zero ground rent.
• Freeholders lose the ability to charge "marriage value" (the extra cost paid when a lease falls below 80 years).

While owning the freehold is still the ultimate goal for many—as it gives you control over service charges and building management—a 990-year lease extension offers almost identical security for the average homeowner.

Marriage Value and Cost Reductions

Perhaps the biggest win for leaseholder rights 2026 is the abolition of "marriage value." Previously, if your lease dropped below 80 years, the cost of extending it spiked because you had to pay the freeholder 50% of the "unlocked" value of the property.

The new Bill removes this requirement, potentially saving leaseholders thousands, if not tens of thousands, of pounds. This makes it significantly more affordable for those with "short" leases to regain control of their assets.

How to Prepare for the 2026 Reforms

If your lease is approaching 80 years, or if you are struggling with high ground rent, follow these steps:

1. Check your current lease term: Find out exactly how many years are remaining.
2. Wait for the new valuation calculator: The government is set to release a standardised calculator to prevent freeholders from overcharging for extensions.
3. Gather your documents: Ensure you have your lease agreement and title deeds ready.
4. Budget for legal fees: While the premium to the freeholder will be lower, you will still need to pay for professional valuations and legal work.

FAQ: Your 2026 Leasehold Questions Answered

When exactly do the 2026 reforms take effect?

While the Act is law, the secondary legislation required to set the new "rates" for extensions is expected to be fully implemented by early 2026.

Can I still be charged marriage value if I extend now?

If you complete an extension under the current rules (before the 2026 valuation changes are live), you may still have to pay marriage value. Many experts suggest waiting for the new system if your lease is already under 80 years, provided you don't need to sell immediately.

Does the 990-year extension apply to houses?

Yes. The reform treats houses and flats equally, allowing both to benefit from the 990-year term and the peppercorn ground rent.

Will these changes make it easier to sell my flat?

Absolutely. Many lenders are hesitant to offer mortgages on properties with leases under 85 years or with doubling ground rents. By extending to 990 years, you make your property much more attractive to buyers and banks alike.