Commonhold is a form of property ownership that was introduced in England and Wales by the Commonhold and Leasehold Reform Act 2002 as an alternative to the traditional leasehold system. It allows you to own your flat outright (freehold) while sharing responsibility with other flat owners for the management of the building and communal areas.
Unlike leasehold, there is no lease term ticking down, no ground rent, and no need to pay large sums for lease extensions.
🔑 Key features of commonhold
- Outright ownership of your flat
- You own your individual unit (for example, your flat) as a freehold estate.
- Ownership is permanent — there is no lease expiry date.
- Shared ownership of communal areas
- All flat owners in the block collectively own and manage the common parts (hallways, roofs, gardens, lifts, etc.) through a corporate body called a Commonhold Association.
- No ground rent or lease extensions
- Because you own your property outright, you don’t pay ground rent.
- There’s no need to extend your lease or pay premiums to a freeholder, as there is no “landlord” above you.
- Democratic control
- Decisions about repairs, service charges, and building management are made collectively by the unit owners.
- This system aims to give homeowners greater control and transparency compared to traditional leasehold management structures.
🏡 Commonhold vs Leasehold
| Commonhold | Leasehold |
| You own your flat outright, forever | You own your flat for a fixed term (e.g. 99 or 125 years) |
| No lease expiry, no marriage value | Lease shortens over time; extension premiums increase, especially under 80 years |
| No ground rent | Ground rent often payable (though reforms have restricted this for new leases) |
| Collective control via Commonhold Association | Freeholder/landlord retains control, often leading to disputes |
🌍 Commonhold abroad vs UK uptake
- In many countries — including much of Europe, North America, and Australia — commonhold-style ownership is the standard way to own a flat.
- In the UK, however, commonhold has seen very limited adoption since 2002. Reasons include:
- Developers prefer leasehold, which generates additional income streams (ground rent, lease extensions, enfranchisement premiums).
- Mortgage lenders and conveyancers have been slow to adapt.
- Lack of political will and inertia in updating laws to make commonhold more attractive.
As a result, leasehold remains the dominant model of flat ownership in England and Wales, even though many campaigners argue commonhold is fairer and simpler.
📈 The future of commonhold
The government has expressed interest in reviving commonhold as part of broader leasehold reform, including within the Leasehold and Freehold Reform Act 2024. However:
- No immediate switch to commonhold has been legislated.
- Uptake remains low, and further reform is needed to make it a mainstream option.
For now, leaseholders still rely on existing rights such as lease extensions and collective enfranchisement to protect their interests.
✅ Summary
Commonhold is a system of flat ownership where you own your home outright and share responsibility for communal areas with your neighbours. It eliminates many of the problems associated with leasehold — such as expiring leases, ground rents, and expensive extensions — and is common abroad.
In the UK, however, commonhold has struggled to take hold due to legal inertia and market resistance. Until further reforms make it more practical, leasehold remains the prevailing system for flat ownership.
At extension.lease, we keep clients informed about the future of commonhold and advise on the best options currently available — whether that’s extending a lease, buying the freehold, or exercising management rights.
