A group of landowners has launched a judicial review in the High Court to challenge the government’s efforts to reform the freehold and leasehold property ownership system.
Among them are some of the UK’s wealthiest landowners and two major charities, who collectively hold the freeholds of thousands of properties – primarily flats. They argue that legislation passed by the previous Conservative government in 2024 infringes on their human rights.
Specifically, they claim that the new law violates their right to peaceful enjoyment of private property, as protected under the European Convention on Human Rights (ECHR).
However, leaseholders have raised concerns that the legal challenge could delay long-awaited reforms. Many also point out that their interests are not being represented in court.
The High Court hearing, which started yesterday, is scheduled to run until Friday.
The legal challenge follows the fast-tracking of the Leasehold and Freehold Reform Act (LAFRA) through Parliament ahead of the 2024 general election. The legislation, designed to strengthen the rights of leaseholders, was widely welcomed by campaigners. Key reforms include simplifying the process of extending a lease and purchasing a freehold, while also aiming to reduce costs for leaseholders.
However, several major freeholders are now contesting aspects of the new law – particularly the revised methods for calculating the cost of lease extensions. In earlier legal filings, they claimed the changes could result in financial losses amounting to hundreds of millions of pounds and argue that the legislation denies them fair compensation.
Leaseholders, meanwhile, worry that the legal challenge could significantly delay reforms they say are long overdue. Many have also expressed concern that their perspectives are not being represented in court.
There are an estimated 4.5 million leasehold property owners in England and Wales. Scotland abolished leasehold in the 1980s, and Northern Ireland operates under a slightly different system.
The National Leasehold Campaign said in a statement: “Whilst the lawyers fight this out in the courtroom, leaseholders are nervously awaiting the outcome. There is a real human impact that cannot be underestimated. Time will tell if Justice will be served, but in the meantime, leaseholders remain in a state of ‘Limbo’, trapped by this iniquitous system, with no way out. This really is a David vs Goliath battle.
“For too many years, leaseholders have been exploited by feudal leasehold laws which are not fit for the 21st century. It cannot go on. The current status quo must not be maintained, and this is the opportunity for meaningful change. Leaseholders deserve better. Enough is Enough.”
