Leasehold has long been a defining feature of the UK property market. While much of the attention focuses on Prime Central London, where leasehold enfranchisement deals can run into the millions, thousands of leaseholders across regional cities and towns face similar challenges on a different scale.

Whether it is buying the freehold through collective enfranchisement, extending a short lease, or funding major works under Section 20 notices, the financial burden can be significant. In 2025, rising costs of construction, stricter building safety requirements, and leasehold reform have combined to make financing these obligations a pressing issue for homeowners and investors alike.

This article explores how enfranchisement and major works financing works outside of London’s prime postcodes, what lenders are willing to fund, and how Willow Private Finance helps leaseholders navigate what can otherwise be a minefield.

Why Leasehold Enfranchisement Matters

Owning the freehold—or extending a short lease—creates security and long-term value. Mortgage lenders are often unwilling to lend on properties with fewer than 70–80 years left on the lease. Values can also decline rapidly once leases shorten, particularly once they dip below the 80-year threshold and marriage value calculations come into play.

For homeowners in places like Manchester, Birmingham, or Leeds, enfranchisement is not just about investment—it can be about preserving marketability. A flat with 60 years left on the lease may sell for significantly less, while the cost of extending it only rises each year.

Major Works and Section 20 Demands

Beyond enfranchisement, leaseholders often face substantial bills for major works. Local councils and freeholders are increasingly issuing Section 20 notices to cover external repairs, fire safety upgrades, or cladding remediation. While Prime Central London headlines may highlight six- or seven-figure demands, regional leaseholders also face bills of £20,000–£80,000—enough to cause serious financial strain.

In 2025, the emphasis on fire safety post-Grenfell, coupled with new sustainability requirements for older buildings, has pushed more freeholders to initiate costly works. For many homeowners, borrowing is the only realistic way to meet these obligations.

Financing Options in 2025

There are several routes open to leaseholders, each with its own considerations.

Remortgaging or Further Advances

For those with sufficient equity, remortgaging or applying for a further advance is the simplest way to raise funds. However, the property’s lease length can restrict options—short leases often make remortgaging difficult without simultaneously funding an extension.

Second Charge Mortgages

When remortgaging is not possible—perhaps due to attractive rates on the main loan—a second charge mortgage can raise the required capital without disturbing the existing arrangement.

Specialist Enfranchisement Loans

Some lenders and private banks now offer products specifically tailored to enfranchisement or lease extension costs. These often account for the uplift in property value that results once the freehold is secured or the lease extended.

Bridging Finance

When timelines are tight—such as short notice on a Section 20 demand or a freehold purchase deadline—bridging loans can provide immediate funds, later refinanced onto a mainstream product.

Regional Dynamics

Outside London, enfranchisement and major works financing is less about trophy assets and more about safeguarding value. A group of leaseholders in a Leeds apartment block may collectively need to raise £1 million to buy their freehold, with individual contributions of £30,000–£50,000. In Birmingham, cladding remediation has left many facing bills of £40,000 each.

The sums may be smaller than those in Mayfair or Knightsbridge, but the impact is often just as profound. For many, failure to finance these obligations risks being trapped in unsellable homes.

Real-World Example

Willow recently worked with a group of leaseholders in a Manchester development facing combined major works and lease extension costs of over £500,000. Several owners had limited equity and were initially declined by high street lenders. By structuring bespoke second charge and private bank loans, we enabled each leaseholder to access the funds required. As a result, the building’s value was preserved, and individual flats avoided falling into negative equity territory.

Strategic Considerations

The key to financing enfranchisement and major works is timing. Costs increase the longer action is delayed, while property values continue to erode as leases shorten. For landlords, these obligations also tie directly into lending criteria—portfolio valuations can be dragged down by even a handful of properties with short leases or unresolved major works.

A proactive approach is essential. Understanding the available options, engaging with lenders early, and preparing documentation in advance can mean the difference between a successful solution and a distressed sale.

How Willow Can Help

At Willow Private Finance, we work with leaseholders, landlords, and collective groups to arrange funding for enfranchisement and major works. We understand the complexity of short leases, the urgency of Section 20 demands, and the appetite of lenders who are willing to support these cases.

Because we are independent and whole of market, we can assess whether remortgaging, second charges, bridging finance, or private bank solutions will deliver the best outcome. For clients outside Prime Central London, this tailored approach ensures regional leaseholders receive the same level of expertise as high-value London borrowers.

📞 Want Help Navigating Today’s Market?

If you are facing a lease extension, enfranchisement contribution, or major works demand in 2025, you do not need to face it alone.