Small investors launch Justice for Property Rights campaign over retrospective leasehold reform
Government figures and industry estimates suggest that reforms could result in tens of billions in lost asset value, with previous impact assessments indicating losses exceeding £30bn without compensation*
A coalition of small property investors, retirees, shared freeholders and long-term savers has today launched Justice for Property Rights, a new campaign group calling on the government to ensure leasehold reform does not unfairly penalise ordinary people with lawful existing property interests. The group has to date over 200 members and is rising daily.
The group says it supports action to tackle genuinely unfair lease terms and backs efforts to make commonhold a workable alternative. However, it warns that current proposals risk going further by retrospectively reducing or extinguishing rights attached to existing ground rent arrangements, without a clear commitment to fair compensation.
Justice for Property Rights argues that public debate has become overly focused on a small number of large estates and institutional investors, obscuring the reality that many affected owners are private individuals with modest portfolios.
These include retirees who rely on ground rent income as part of their pension, families who have invested in small freehold interests over many years, and resident-controlled freehold companies responsible for managing their own buildings. It also includes people who have invested in insurance backed pensions and savings products.
Ground rents have been relied upon by individuals for centuries as a secure and reliable asset because property rights in UK law have been indisputably the most robust in the world. More recently institutions have recognised them as a safe and reliable haven to protect the interests of pensioners and investors. Several household name leading UK pension and insurance companies - such as M&G, Aviva and Rothesay Life - that are invested in ground rent portfolios have raised alarm through their industry bodies UK Finance and Association of British Insurers evidence submissions to the Housing Communities and Local Government Pre-legislative scrutiny committee.
This is not about defending bad practice. Where lease terms have been unfair, they should be fixed. Where commonhold can work, it should be supported. But reform must be proportionate. It should not retrospectively strip lawful income and asset value from thousands of ordinary people who invested in good faith, many of whom are not wealthy institutions, but small investors, pensioners and families.
The campaign stresses that many existing ground rent arrangements involve modest annual sums and long-standing, stable structures. In some cases, a majority of leaseholders themselves collectively own their freehold and rely on these arrangements to fund their own borrowings from the freehold purchase.
It warns that treating all existing arrangements as though they were abusive risks creating unintended consequences, including financial harm to individuals who have complied fully with the law as it stood at the time of their investment.
Justice for Property Rights is calling for a balanced and targeted approach to reform, including:
Action to address genuinely unfair or exploitative lease terms
A balanced approach to support the transition to commonhold
Clear safeguards to protect existing lawful property rights
Fair compensation where government policy changes materially affect those rights
The group is now taking legal advice on bringing a collective action before the European Court of Human Rights. This follows last week’s Court of Appeal decision granting permission to a consortium of major freeholders to challenge the Leasehold and Freehold Reform Act 2024. There is increasing alarm that populist policymaking risks eroding centuries-old protections for property rights and the rule of law. The Court of Appeal’s explicit reference to “proportionality” will be central to the case. Why should UK taxpayers bear potential liabilities of over £30 billion, particularly where a substantial portion of these gains will flow to already affluent leaseholders in central London?
This is about fairness and legal certainty. Leaseholders and freeholders, advised by lawyers and conveyancers with a duty of care, made long-term decisions based on the law as it existed. The government has every right to reform the system, but it should do so carefully, clearly and fairly, without making ordinary investors collateral damage.
Notes to editors
Justice for Property Rights is a newly established campaign representing small-scale property investors, retirees, shared freeholders and other individuals with lawful existing interests in residential freeholds.
The campaign supports proportionate leasehold reform and the development of commonhold as a long-term alternative.
It is focused on ensuring that reforms distinguish between abusive practices and legitimate, long-standing arrangements.
The group is particularly concerned about the potential retrospective impact of proposed changes on individuals who invested in good faith under existing legal frameworks.
* £37.5B comes from the 2023 Treasury Impact Assessment. To date, the government has refused to provide how they arrived at these figures as they seem understated.
See: https://committees.parliament.uk/writtenevidence/163042/html/