Answers · UK 2025/26
What is commonhold property ownership in the UK?
Commonhold is a form of freehold ownership for flats and other interdependent properties in which each unit owner holds their flat as a freehold and jointly owns the communal areas through a Commonhold Association. It was introduced in 2002 but rarely used. The Law Commission has recommended major reforms to make it the default for flats, replacing leasehold.
Full answer
Commonhold was introduced by the Commonhold and Leasehold Reform Act 2002 as an alternative to leasehold for flats, providing each flat owner with freehold title to their unit and collective freehold ownership of communal areas through a Commonhold Association (a company limited by guarantee). **How commonhold works:** - Each unit owner holds the freehold of their individual flat (the "commonhold unit") - The Commonhold Association owns and manages the common parts (staircases, roof, external walls, grounds) - All unit owners are members of the Association and vote on management decisions - A Community Statement sets out the rules, obligations, and rights (broadly equivalent to a lease) - No ground rent is payable -- owners simply pay service charges for actual maintenance costs **Why commonhold has not been widely adopted (as of 2026):** - Mortgage lenders were initially reluctant to lend on commonhold (this has improved) - Developers and freeholders opposed it -- freeholders lose the income from ground rents, lease extensions, and forfeiture rights - Converting existing leaseholds to commonhold required unanimous consent of all leaseholders, which is rarely achievable - Lack of legal familiarity among conveyancers and lack of court precedent **Law Commission reform recommendations (2020):** The Law Commission recommended that commonhold be the default tenure for new flats in England and Wales, with a reformed framework making conversion from leasehold to commonhold much easier. Legislation was expected but had not been enacted as of mid-2026. **Leasehold Reform Act 2024:** The Leasehold and Freehold Reform Act 2024 reformed leasehold (longer standard terms, easier extensions, restrictions on ground rents) but stopped short of mandating commonhold -- though it signalled a direction of travel. **Scotland:** Scotland uses a different system -- tenement law under the Tenements (Scotland) Act 2004 -- broadly similar in concept to commonhold but with its own rules.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.