Calls for Public Views on Commonhold Property

The Law Commission have opened an eight week call for evidence on commonhold property ownership, following its failure to gain popularity since being introduced. They are asking for views from the public in order to discover what is preventing commonholds from being more widely used.

Commonhold was introduced in 2004 as a new way to own property allowing a person to own a freehold ‘unit’ (for example, a flat within a building), while also being a member of a ‘commonhold association’ that manages the shared buildings and areas.

What is Commonhold?

Commonhold was introduced as having a number of benefits in comparison to leasehold, namely that ownership doesn’t run out, while leaseholds have an expiry date. Commonholds are also said to standardise conveyancing, making it simpler and cheaper than leaseholds. They also give owners a stake in the building itself, meaning there is no landlord and instead the owners manage it together.

Despite the apparent advantages of commonhold over leasehold, fewer than 20 developments have been created since the legislation came into force. Even major cities such as London and Manchester only have one development each.

Public asked for feedback

There is clearly a problem with take-up, so the Law Commission are seeking views on what the perceived problems are, and what needs to change in order for commonhold properties to become more desirable.

The project will look at the reasons why commonhold has failed to become popular, and what can be changed to make it an attractive and workable alternative to residential leasehold.

The Law Commission are asking for views on three themes:

What the difficulties in creating or converting to commonhold are
What issues make commonhold unattractive to homeowners
What issues make commonhold unattractive in the wider property sector.
Following this call for evidence a full consultation is set to go ahead later this year.

The deadline for responses is Thursday 19th April 2018.

The response form is available from the Law Commission website.

Alternatively you can send comments by email to [email protected], by phone to 020 3334 5333, or by post to:

Rachel Preston
Law Commission
1st Floor, Tower
52 Queen Anne’s Gate
London SW1H9AG