Commonhold Explained: 2026 Guide for UK Flat Owners

Commonhold is back on the agenda. After more than two decades as a legal curiosity, commonhold is set to become the default way of owning a flat in England and Wales, and the draft Commonhold and Leasehold Reform Bill published in January 2026 shows how the government intends to get there. If you own a leasehold flat, are thinking of buying one, or are weighing up share of freehold, understanding commonhold in 2026 matters. This guide explains what commonhold is, how it works day to day, how it compares with leasehold and share of freehold, where the reforms currently stand and what a suitably qualified, accredited surveyor can do to help you prepare.

Key takeaways

• Commonhold is a form of freehold ownership for flats: you own your unit outright and forever, and all unit owners jointly own and manage the building through a commonhold association.
• Commonhold has existed since the Commonhold and Leasehold Reform Act 2002, but fewer than 20 commonhold developments were ever created, mainly because of lender caution and a rigid legal model.
• The draft Commonhold and Leasehold Reform Bill (27 January 2026) would ban leasehold for most new flats, let existing leaseholders convert with 50% support, and cap ground rents at £250 a year.
• The Housing, Communities and Local Government Committee report of 27 May 2026 urged ministers to introduce the final Bill in autumn 2026; as of early October 2026 it has not yet been laid before Parliament.
• Expected timing, subject to Parliament: ground rent cap around 2027–2028, with the new commonhold model available from about 2029.
• Surveyors remain central: lease extension and enfranchisement valuations, building condition surveys of common parts and reserve-fund assessments all shape how smoothly a block moves to commonhold.

What is commonhold?

Commonhold is a form of freehold ownership for flats. Each owner holds the freehold of their own unit permanently, while the shared parts of the building are owned and managed jointly through a commonhold association made up of the unit owners. There is no landlord, no ground rent and no lease that expires.

The framework was created by the Commonhold and Leasehold Reform Act 2002 and switched on in 2004. In practice it never took off: by the time the Law Commission reviewed it, fewer than 20 commonhold developments had been established across England and Wales, against roughly 5 million leasehold homes. The reasons were a combination of lender reluctance, developers’ preference for the income a freehold generates, and a legal structure that was too inflexible for mixed-use or phased schemes. The reforms now moving through Westminster are designed to fix every one of those problems.

How does commonhold work in practice?

Three building blocks hold a commonhold together, and once you understand them the rest follows.

The commonhold association

This is a company limited by guarantee registered at Companies House. Every unit owner is automatically a member, with the right to vote on budgets, appoint directors and approve major works. The directors can be unit owners themselves or a professional managing agent appointed by the members. Because the owners are the company, there is no third-party freeholder taking decisions in their own interest.

The commonhold community statement (CCS)

The CCS is the rulebook for the building. It is a standardised document that sets out what each owner must contribute, how the common parts are maintained, how disputes are handled and any local rules, such as restrictions on short lets or pets. Because it is standardised and registered at HM Land Registry, every flat in the building is subject to the same terms, which removes the lease-by-lease inconsistencies that plague older leasehold blocks.

Commonhold contributions and the reserve fund

Instead of a service charge demanded by a landlord, owners pay commonhold contributions to a budget they vote on each year. The reformed model, set out in the government’s Commonhold White Paper (3 March 2025), makes reserve funds mandatory so that major items such as roof renewal or lift replacement are saved for over time rather than landing as one-off bills. A professional reserve-fund study, normally carried out by a building surveyor, is the tool associations use to work out how much to set aside.

Commonhold vs leasehold vs share of freehold

Buyers often ask whether commonhold is simply share of freehold under another name. It is not. With share of freehold you still hold a lease; you just also co-own the freehold company. Commonhold removes the lease altogether. The table below sets out the main differences.

For a deeper look at the middle column, read our share of freehold guide, and for the fundamentals of the first column see leasehold vs freehold explained.

What does the draft Commonhold and Leasehold Reform Bill change?

The government published the draft Commonhold and Leasehold Reform Bill on 27 January 2026 for pre-legislative scrutiny. Its headline measures are:

• A ban on leasehold for most new flats. Once in force, developers would have to sell new flats as commonhold units, making commonhold the default tenure.
• Easier conversion. Existing leaseholders could convert their building to commonhold where 50% of leaseholders agree, replacing the current requirement for unanimous consent that made conversion practically impossible.
• A ground rent cap. Existing ground rents would be capped at £250 a year, reducing to a peppercorn after 40 years. The Commons committee estimated this affects between 770,000 and 900,000 households.
• Abolition of forfeiture. The threat of losing a flat for a minor breach would be replaced with a more proportionate enforcement scheme.
• A reformed commonhold model. Lender protections, flexibility for mixed-use and phased developments, mandatory reserve funds and clearer dispute procedures, all drawn from the Law Commission’s 2020 recommendations.

The Housing, Communities and Local Government Committee published its scrutiny report on 27 May 2026. It called the draft a significant step but said the government must go further and faster: it recommended that the final Bill be introduced in autumn 2026, that the ground rent cap take effect two months after Royal Assent rather than at a later discretionary date, that the 40-year transition to peppercorn be justified or shortened, and that commonhold become the default outcome of collective enfranchisement. It also backed an independent regulator for managing agents.

Where are the reforms in October 2026?

The King’s Speech on 13 May 2026 confirmed the Bill as part of the government’s programme. As of the first week of October 2026, however, the final Bill has not yet been introduced to Parliament; the HomeOwners Alliance reports (update of 1 October 2026) that ministers have committed to bringing it forward during the current parliamentary session. The Leasehold Advisory Service (LEASE) currently expects the ground rent cap to arrive around 2028 and the new commonhold model to be available from around 2029, although the committee has pressed for both to come sooner.

Separately, the Leasehold and Freehold Reform Act 2024 is still being switched on in stages. The two-year ownership rule for lease extensions and freehold purchases was removed in early 2025, and right-to-manage claims became cheaper and open to more buildings from 3 March 2025. The biggest valuation changes, including the abolition of marriage value, are on the statute book but not yet in force. The government’s consultation on the deferment and capitalisation rates used in those calculations opened on 15 July 2026 and closes at 11:59pm on 21 October 2026; the options range from keeping the long-standing 4.75% (houses) and 5% (flats) deferment rates to updating them to somewhere between 5.05% and 6.3%. Our note on the valuation rates consultation explains why the outcome matters to anyone extending a lease.

Is commonhold better than leasehold?

For most owner-occupiers the answer is yes, with caveats. The advantages are clear: permanent ownership with no wasting asset, no ground rent, no landlord, a say in every spending decision, and a mandatory reserve fund that smooths out big bills. The CCS also gives buyers certainty, because every unit is on the same terms.

The caveats are practical rather than legal. First, a commonhold is only as well run as its members: if nobody wants to be a director, the association will need to pay a managing agent, just as a share-of-freehold company does. Second, mortgage availability is still catching up. The HomeOwners Alliance reports that only around a third of lenders currently offer commonhold mortgages, though about half have said they will lend once the reforms pass. Third, conversion of an existing block is a project: the leaseholders must buy out the freeholder, which means an enfranchisement valuation and, usually, a condition survey of the building they are about to take on.

How do you convert a leasehold block to commonhold?

Under the current law, conversion requires the consent of every leaseholder and the freeholder, which is why it almost never happens. The draft Bill lowers the threshold to 50% of leaseholders, broadly aligning it with collective enfranchisement. The expected route, once the legislation is in force, looks like this:

• Organise the owners. Identify the participating leaseholders and confirm that at least half the flats support conversion.
• Value the freehold. The participating owners must buy the freehold from the landlord. The price is formula-based and reflects lost ground rent and the reversion, so an accredited valuer should prepare a collective enfranchisement valuation before any offer is made.
• Survey the building. A building survey of the common parts (roof, structure, services, fire safety) tells the group what liabilities they are inheriting and feeds directly into the first reserve-fund budget.
• Set up the commonhold association and CCS. Register the company, adopt the standard statement with any local rules, and register the commonhold at HM Land Registry.
• Deal with non-participants and lenders. The reformed model is designed to let conversion proceed without unanimity, with protections for owners who do not take part and for existing mortgage lenders.

If your building is not ready for a full conversion, right to manage remains a quicker way to take control of day-to-day management without buying the freehold.

What should flat owners do now?

Commonhold will not arrive overnight, and the sensible course depends on your lease. If your lease is approaching or below 80 years, do not wait for the reforms: the marriage value abolition is not yet in force, and the valuation rates consultation could move premiums in either direction. Get an up-to-date lease extension valuation so you can decide whether to serve notice now or hold. If you are buying a flat, ask the seller’s solicitor whether the building has any history of right-to-manage or enfranchisement activity, check the service charge accounts for a reserve fund, and commission an appropriate level of building survey; the condition of the common parts will matter even more once owners are collectively responsible for them. And if you are in a share-of-freehold block, keep an eye on the final Bill, because the committee’s recommendation that commonhold become the default outcome of enfranchisement could give you a streamlined path to convert.

How surveyors support commonhold and leasehold decisions

Whatever tenure you end up with, the surveying work is the same discipline applied at different moments. Suitably qualified, accredited surveyors regulated by bodies such as RICS, CIOB and RPSA provide: enfranchisement and lease extension valuations under the statutory formulae; Red Book valuations for lending on commonhold or share-of-freehold units; planned maintenance and reserve-fund assessments for associations; reinstatement cost assessments for the building’s insurance; and Level 2 or Level 3 surveys for buyers. Using an accredited professional also matters at tribunal: if the freeholder disputes a conversion price, an expert valuation report is what the First-tier Tribunal will weigh.

Why choose Survey Merchant for your commonhold or leasehold survey?

Survey Merchant connects you with a panel of suitably qualified, accredited surveyors, regulated by bodies including RICS, CIOB and RPSA, matched to the specific job rather than a one-size-fits-all appointment. For commonhold and leasehold matters that means valuers who handle Section 42 and collective enfranchisement work every week, and building surveyors who understand the common-parts issues that drive reserve-fund budgets. We cover the whole of the UK, with local surveyors who know the block types and price levels in your area. Fees are fixed and quoted up front, turnaround is fast, and the advice is impartial because our surveyors act for you, not for a freeholder or developer. From the first valuation to tribunal representation, you get end-to-end support from one point of contact.

Ready to take the next step? Explore our lease extension and enfranchisement valuation service, see what a professional valuation involves, or contact Survey Merchant today for a fixed-fee quote.

Sources and further reading

• Draft Commonhold and Leasehold Reform Bill – GOV.UK (27 January 2026)
• Commonhold White Paper – GOV.UK (3 March 2025)
• Pre-legislative scrutiny of the draft Commonhold and Leasehold Reform Bill – House of Commons HCLG Committee (27 May 2026)
• Leasehold enfranchisement valuation rates consultation – GOV.UK (closes 21 October 2026)
• Commonhold and Leasehold Reform Act 2002 – legislation.gov.uk
• Commonhold and Leasehold Reform Hub – RICS
• Draft Commonhold and Leasehold Reform Bill – Leasehold Advisory Service