Commonhold Explained
Commonhold is a way of owning a flat outright instead of on a lease. It has existed in law since 2004 and has barely been used. That is now changing, but more slowly than the headlines suggest, and the honest answer for most existing buildings today is that commonhold is not yet a practical option. This page explains what it is, where the reform has actually got to, and what is worth doing in the meantime.
What commonhold is
Each flat owner owns their unit freehold, with no lease and no expiry date. The common parts of the building are owned and run collectively by a commonhold association, a company that every unit owner is automatically a member of. The association adopts a commonhold community statement setting out the rules and how costs are shared.
There is no external freeholder, no ground rent, no lease extensions and no marriage value. What replaces them is a commonhold assessment, which is the equivalent of a service charge, set by the association rather than by a landlord.
Commonhold compared with leasehold
Ownership. Leasehold is a wasting asset with a term. Commonhold is freehold and perpetual
Who is in charge. Leasehold puts a landlord between the owners and the building. Commonhold gives control directly to the unit owners
Money. Service charge under a lease, commonhold assessment under a commonhold community statement
Ground rent. None under commonhold
Extensions and enfranchisement. Irrelevant under commonhold, because there is no lease to extend and no freehold to buy
Where the reform has got to
Position as at September 2026. The Government published a draft Commonhold and Leasehold Reform Bill on 27 January 2026. It went through pre-legislative scrutiny by the Housing, Communities and Local Government Committee, which reported on 27 May 2026, concluding that the draft was a significant step but that the Government should go further and faster. Among other things the Committee recommended that the final Bill be introduced in autumn 2026 and that conversion to commonhold become the default outcome of collective enfranchisement.
Separately, the Government consulted on banning leasehold for most new flats. That consultation closed on 24 April 2026 and the responses were still being analysed at the time of writing.
So: commonhold is not yet the default for new flats, and the Bill has not yet been introduced. Anyone telling you commonhold is available now for your existing building is ahead of the law.
Converting an existing building
This is the part that matters for buildings already standing. Under the Commonhold and Leasehold Reform Act 2002 as it stands, converting a leasehold building to commonhold requires the consent of every leaseholder, the freeholder and every lender with a charge over a flat. Unanimity has made conversion effectively impossible, which is the main reason so few commonhold developments exist.
The draft Bill proposes reducing that threshold to 50 per cent of qualifying leaseholders. If that survives into the final Act, conversion becomes realistic for the first time. Until it does, it is not.
What to do in the meantime
If what you actually want is control of your building, you do not have to wait for commonhold. Right to Manage is available now, is no-fault, and transfers management to a company the leaseholders control. Collective enfranchisement buys the freehold. Both are well-established, and both leave you better placed if and when conversion becomes possible, because you already have a functioning resident-controlled company, clean accounts and an orderly set of records.
The buildings that will convert easily are the ones that are already well run. That is the practical preparation.
How Temphis helps
We manage around 1,000 units across 50 buildings for freeholders, RTM companies and resident management companies, and we take on ten to fifteen new properties a year. For buildings thinking about commonhold we can advise on whether Right to Manage or enfranchisement gets you what you want sooner, run the company secretarial and governance side of a resident-controlled company, and keep the financial and compliance records in the state a conversion would require.
Frequently asked questions about commonhold
Can I convert my building to commonhold now?
In practice, no. Conversion currently needs unanimous consent from all leaseholders, the freeholder and all lenders. The draft Bill proposes lowering this to 50 per cent of qualifying leaseholders, but it is not law yet.
Is commonhold the default for new flats?
Not yet. The Government consulted on banning leasehold for most new flats, closing in April 2026, and has not yet legislated.
Do you still pay a service charge under commonhold?
Yes, though it is called a commonhold assessment. Buildings still need insuring, maintaining and cleaning. The difference is who sets the budget and who is accountable for it.
Is there ground rent under commonhold?
No. There is no landlord and no lease, so no ground rent and no lease extensions.
Does commonhold work for mixed-use buildings?
It can, but the commercial elements complicate the community statement and cost apportionment. This is one of the areas the reform is still working through.
Should we wait for commonhold rather than doing Right to Manage?
Usually not. RTM is available now and gives you control of management, which is what most leaseholders actually want. It does not prevent a later conversion and makes one easier.
Talk to us about your building
If you are a resident management company, RTM company, leaseholder group or freeholder weighing up commonhold, we can give you a straight view on whether it helps you and what the realistic alternatives are today. Request a free initial discussion.
