Understanding the Commonhold and Leasehold Reform Bill: What It Means for Dorset Flat Owners

Parliament is working through the most significant overhaul of residential property tenure in a generation. The Leasehold and Freehold Reform Act 2024, combined with the ongoing Commonhold and Leasehold Reform Bill now progressing through Parliament, represents a fundamental reshaping of the relationship between freeholders, leaseholders, and the managing agents who sit between them.

For flat owners across Dorset and Hampshire — many of whom hold long leases on coastal conversions, retirement developments, and purpose-built blocks in Bournemouth, Poole, Christchurch, and beyond — the changes are both welcome and complex. Understanding what is proposed, what is already law, and what remains subject to further consultation is essential before drawing conclusions about how your property is affected.

At Rebbeck Brothers, we have been monitoring the progress of this legislation closely. As a RICS-regulated firm with nearly 180 years of experience managing residential blocks across the region, we are well placed to help leaseholders and Resident Management Companies (RMCs) make sense of the changes ahead.

The Leasehold Reform Landscape: What Is Changing

The legislative programme has two distinct elements. The Leasehold and Freehold Reform Act 2024 has already received Royal Assent and introduced several immediate changes. The Commonhold and Leasehold Reform Bill, still progressing through Parliament as of 2025, goes significantly further.

Together, they represent the government’s ambition to eventually abolish leasehold for new residential flats and replace it with commonhold — a form of ownership more familiar in Australia, the United States and much of continental Europe, in which individual unit owners collectively own and manage the freehold of the building.

Q: What does the Commonhold and Leasehold Reform Bill actually propose?

The Bill contains several headline proposals that directly affect flat owners:

Ground Rent Cap: Ground rents for existing leases are proposed to be capped, building on the Leasehold Reform (Ground Rent) Act 2022 which already banned ground rents on new leases. The precise mechanism for existing leases is still subject to consultation, but the direction of travel is clear — ground rents as an investment vehicle are coming to an end.

Commonhold as Default Tenure: The Bill proposes that commonhold becomes the default tenure for new residential flat developments, replacing the leasehold model entirely for new-build. Under commonhold, leaseholders become unit owners with a share in the freehold via a Commonhold Association — removing the need for a separate freeholder.

Abolition of Forfeiture: The Bill proposes abolishing the right of forfeiture — the draconian remedy by which a freeholder can, in theory, reclaim a flat worth hundreds of thousands of pounds over a relatively small debt. The current system creates significant power imbalances and is widely recognised as unjust.

Lease Extension Rights: The 2024 Act has already extended lease extension rights significantly, including removing the two-year ownership requirement and improving the valuation methodology in leaseholders’ favour.

Q: What does this mean for existing leaseholders in Dorset?

The immediate practical impact for most existing leaseholders is modest but directionally positive. Those with short leases — a significant concern in Dorset’s coastal retirement market, where properties are sometimes purchased without adequate attention to lease length — will benefit from a more accessible and affordable extension process. The removal of the two-year waiting period is particularly significant for recent purchasers.

For leaseholders in BCP coastal blocks — Victorian conversions in Boscombe and Southbourne, post-war purpose-built blocks on the East Cliff and West Cliff, and retirement developments in Branksome and Canford Cliffs — the abolition of escalating ground rents will provide reassurance about long-term holding costs.

Q: What do Resident Management Companies need to know?

RMCs that already hold the freehold of their building are less directly affected by the shift to commonhold. However, RMC directors should be aware that the broader legislative programme is increasing the obligations placed on those who manage residential blocks, whether through tighter service charge transparency requirements, expanded building safety duties, or the new residential management code from RICS.

RMCs operating without professional management support should consider whether their current arrangements are adequate in light of the growing regulatory burden.

Q: What about the transition to commonhold for existing blocks?

Converting an existing leasehold block to commonhold is technically possible under existing law but is rarely achieved in practice because it requires unanimous consent from all leaseholders. The Bill is expected to lower this threshold, but the precise mechanism has not yet been finalised. For most existing blocks in Dorset, leasehold will remain the operative tenure for many years yet. The meaningful near-term changes are in lease extension rights, service charge transparency, and the regulatory framework.

Q: How is Rebbeck Brothers preparing for these changes?

We have reviewed our service charge accounting practices, budget reporting, and client communication procedures in light of the extended transparency requirements already introduced and those anticipated under forthcoming secondary legislation. Our RICS-regulated status means we are already held to the standards that the new legislation seeks to mandate across the wider sector. We are attending continuing professional development sessions and industry briefings to ensure our management practices remain fully current.

For leaseholders and RMC directors who want to understand how the reforms affect their specific block or lease, our Bournemouth office is available to discuss the detail.

Q: Why does local expertise matter during a period of legislative change?

Legislation of this scope and complexity requires careful interpretation at the block level. The rights available to a leaseholder in a 1970s Bournemouth purpose-built block with a 95-year lease and a £150 per annum ground rent are different from those available to a leaseholder in a new-build Poole Harbour development with a peppercorn ground rent. General media coverage rarely captures these distinctions. Working with a managing agent who understands the specific tenure arrangements, the physical nature of your building, and the legal frameworks applicable in your area is the most reliable way to navigate change with confidence.

The Leasehold and Freehold Reform Act 2024 and the forthcoming Commonhold and Leasehold Reform Bill represent a once-in-a-generation shift in English property law. At Rebbeck Brothers, we are committed to ensuring that the leaseholders and RMC directors we work with understand what is changing, when it will take effect, and what practical steps are available to them. If your block is managed by a firm that has not yet raised these issues with you, it may be time to ask why.