Leasehold and Freehold Reform Act 2024 Part 4 Consultation

On 4 July 2025, the Ministry of Housing, Communities and Local Government launched a public consultation on how to implement the measures to improve the leasehold system that the Leasehold and Freehold Reform Act 2024 (the “2024 Act”) is seeking to introduce.

Part 4 of the 2024 Act seeks to bring greater regulation to the leasehold ownership system, and provide leaseholders with greater protections, rights and powers over their properties. Specific areas of focus of Part 4 of the 2024 Act include creating greater transparency around service charges and building insurance policies, and measures to enable more leaseholders to challenge unfair practices by landlords. The consultation is seeking views on how to implement the following measures (amongst others) that the 2024 Act will look to introduce.

Annual report for tenants

Under the 2024 Act, landlords will be obligated to provide tenants with an annual report, that provides the details of service charge expenditure and information relating to any proposed major works in the upcoming year. The consultation proposes the report should include the contact details of the main people associated with the building, a reminder of key dates such as service charge demands and planned surveys, and details of major works planned. The consultation is seeking views on what information should be included within the report and how this information should be provided to leaseholders. The 2024 Act provides for exemptions to landlords having to provide an annual report. The consultation is seeking views on where exemptions may be required.

Standardised service charge demand form

The 2024 Act will seek to introduce a standardised service charge demand form to ensure all tenants are provided with a minimum level of information relating to the service charges they pay or will be required to pay. The consultation is seeking views on the minimum information that a service charge demand should contain.

Where leaseholders wish to obtain information outside the annual report and service charge demand form, the 2024 Act extends the rights of leaseholders to obtain further information on request to landlords. The 2024 Act will allow for a new prescribed list of the types of information that landlords must provide upon a leaseholders request. The consultation is seeking views on what types of information should be included within this prescribed list.

Insurance policy information

The consultation recognises that the cost of building insurance can make up a significant portion of service charge costs incurred by leaseholders. The 2024 Act will require landlords to proactively provide leaseholders with information on their insurance policy. Providing leaseholders with information on their insurance policy is not a duty for landlords under existing arrangements. The consultation is seeking views on what additional information leaseholders should receive in regard to building insurance, and the form and manner this should be provided in. By being better informed, leaseholders can be confident that their building insurance is fair, and enables leaseholders to better challenge any unreasonable insurance costs.

Litigation costs

The consultation recognises that “landlords often have an advantage” in the current litigation costs regime. Typically due to the fact that leases often contain clauses allowing landlords to recover their litigation costs from leaseholders regardless of the outcome of the dispute. This can deter leaseholders from bringing claims forward against their landlords. Additionally, the onus is currently on leaseholders to make an application to the courts to limit their liability for their landlords litigation costs. Consequently, the 2024 Act aims to rebalance the litigation costs regime. Under the 2024 Act, where landlords wish to recover their litigation costs from leaseholders through either the service charge or an administration charge, court approval will now be required. Furthermore, the onus will be on landlords to make such an application seeking the courts approval.

The 2024 Act will also afford leaseholders with the right to apply to the court/tribunal to recover their litigation costs from their landlords in certain proceedings. The consultation is seeking views on how to ensure the most efficient use of tribunal/court time whilst ensuring leaseholder and landlord protections are safeguarded. Additionally, the consultation wants views on the best approach for cases that are only partially admitted by a leaseholder.

The role of managing agents

The 2024 Act hopes to improve the standard at which managing agents perform their role. The consultation is proposing the introduction of mandatory minimum qualifications for managing agents. The consultation states that a “voluntary approach” towards managing agents obtaining qualifications is not enough. The consultations preferred method is to require all managing agents to join a designated professional body. The consultation is also seeking views on two alternative options:

1) Giving the UK Government-approved redress scheme a statutory role in the implementation of qualifications, working with local authorities

2) Making local authorities solely responsible for enforcement.

Section 20

The consultation is also seeking views on how to reform major work consultations carried out under “Section 20” of the Landlord and Tenant Act 1985. This includes reviewing the scope of what should be included within the Section 20 process. In line with the wider consultation aims, the consultation hopes to make the Section 20 process more transparent for leaseholders and provide leaseholders with the opportunity to influence decisions on the choice of contractor, the works to be carried out, or the proposed contract.

The government intend to implement the measures of the 2024 Act through detailed secondary legislation. By submitting their views to the consultation, those with an interest in leasehold property can ensure that the unique aspects of their leasehold arrangements are considered in the technical detail of any secondary legislation.

The consultation closes on 26 September 2025. Submit your views to the consultation by completing the online enquiry form or emailing your answers to the consultation questions to: protectingleaseholders@communities.gov.uk.