The government's draft Commonhold and Leasehold Reform Bill proposes capping ground rents at £250 a year, abolishing forfeiture and banning leasehold for most new flats, affecting leaseholders and landlords.
Key facts
- Who: Leaseholders and landlords in England and Wales, and owners of freehold properties on estates with rentcharges
- From: Draft Bill; not yet in force
- Source: Draft Commonhold and Leasehold Reform Bill
The government has published a draft Bill to modernise, strengthen and reinvigorate the commonhold and leasehold framework. It says the Bill, when implemented, will deliver its manifesto and King's Speech commitments.
What the draft Bill would do
The main aims are:
- to reinvigorate the commonhold model and make it easier for existing leaseholders to convert to commonhold if they wish;
- to ban the use of leasehold for most new flats;
- to cap ground rents at £250 a year, changing to a peppercorn after 40 years;
- to abolish forfeiture, which the government calls a "draconian threat", and replace it with a new lease enforcement scheme that it describes as fairer and more proportionate for leaseholders and landlords;
- to repeal similarly harsh enforcement powers that apply to estate rentcharges on freehold estates.
The government says the reforms will significantly improve the system for the 5 million existing leasehold properties and their owners, while giving a better deal to future homeowners in England and Wales.
The documents
The published package includes a ground rent policy statement, the draft Bill command paper, a Delegated Powers Memorandum, a Guide to the Bill, a draft impact assessment, and a consultation, Moving to Commonhold: consultation on banning leasehold for new flats.
The Housing, Communities and Local Government Select Committee launched its pre-legislative scrutiny of the draft Bill on 4 February 2026.
What this means for leaseholders and landlords
The Bill is still a draft. The proposals describe what the government intends the law to do once implemented, and they do not change anyone's rights or obligations today.
The published package includes a Guide to the Bill and a ground rent policy statement. Anyone with a lease or rentcharge problem should check their documents and get advice on their own position.