Renters' Rights Act 2025, Phase 1 commencement
Transition readiness pack
England

Leasehold Reform

Leasehold Enfranchisement House UK — Buying the Freehold Under LRA 1967 and LFRRA 2024 Changes

Covers the qualifying conditions for freehold acquisition under LRA 1967 (long tenancy; house; 2-year occupation and ownership; abolition of low rent test), the modern method price calculation (diminution + 50% marriage value + compensation), Dano v Earl Cadogan [2023] hope value, and the LFRRA 2024 abolition of marriage value and prescribed valuation rates.

22 min readUpdated 8 June 2026Last reviewed: 17 May 2026leaseholdenfranchisementfreehold-acquisitionlra-1967

Qualifying Conditions — LRA 1967

Qualifying conditions: (a) long tenancy — originally granted for more than 21 years; (b) house (not a flat) — question of fact (Tandon [1982]); (c) 2-year occupation as main or only residence; (d) 2-year ownership of the lease. Low rent test and rateable value limits: fully abolished by LFRRA 2024 (commencement pending). The Act applies to England and Wales.

Price Calculation — Marriage Value, Hope Value, and LFRRA 2024

Modern method price (LRA 1967 s.9(1C)): diminution in landlord's reversion + 50% of marriage value (where lease has under 80 years unexpired) + compensation. Marriage value = unencumbered freehold value minus aggregate of freehold reversion and leasehold value. LFRRA 2024: abolishes the 50% landlord share of marriage value; introduces prescribed valuation rates (commencement pending). Hope value: Dano Ltd v Earl Cadogan [2023] — Supreme Court confirmed hope value payable where the site has development potential.

The Enfranchisement Process

Tenant serves LRA 1967 s.5 notice on the competent landlord (prescribed form; registered as a land charge). Landlord must serve counter-notice within 2 months: admit or deny the right; offer a price. Disputed right: tenant applies to County Court within 2 months. Disputed price: either party applies to the First-tier Tribunal (Property Chamber). Landlord can defeat the claim if genuinely intending to redevelop within 5 years (court approval required). Tenant pays the landlord's reasonable legal and surveying costs.

LFRRA 2024 Reforms

The Leasehold and Freehold Reform Act 2024 (Royal Assent 24 May 2024): (a) abolishes marriage value for all house enfranchisement and lease extension claims; (b) introduces prescribed valuation rates to reduce variability in statutory valuations; (c) removes the low rent test; (d) for collective enfranchisement of flats, relaxes the non-residential floorspace limit from 25% to 50%. Commencement of valuation provisions by secondary legislation — not yet fully in force as of June 2026.

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