The Government is seeking to reinvigorate ‘commonhold’ ownership as an alternative to the ‘long leasehold’ system.
Commonhold allows the freehold ownership of individual flats (or ‘units’) which is not allowed with a lease, and limits the number of years for which you can own a leasehold flat or house. In a commonhold set up, the rest of the block, or estate, is owned and managed by a ‘commonhold association,’ whose members are the unit holders.
Last year, the Law Commission made substantial recommendations in this area. The concept of commonhold has not taken off in England, despite it being on the statute book since the Commonhold and Leasehold Reform Act 2002.
As a first step, the Government has announced the creation of a Commonhold Council, to which it intends to appoint industry and leaseholder representatives, with an aim to work through practical issues prior to legislation and prepare the market for change.
Despite commonhold being available for nearly 2 decades, there has been little interest in this form of tenure, with less than 20 having been created. For all the complaints about leasehold, it has continued – for good or ill – to endure. Whilst there is a political head of steam behind the concept, it remains to be seen whether commonhold revisited will lead to a mass take up, which, in any event, is surely some years away.
If you would like any further information, or have any questions regarding Leasehold Enfranchisement, please get in touch with John Midgley at [email protected] or 020 7725 8068.