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Commonhold vs Leasehold, CLRA 2002, LFRA 2024 and Implications for Property Investors

Landlord Commonhold Guide 2026

Commonhold explained for landlords 2026: permanent freehold ownership of individual flat units (no lease expiry; no ground rent; no landlord-tenant relationship); governed by Commonhold Community Statement (CCS); common parts owned by commonhold association (company limited by guarantee; all unit-holders are members); only ~20-30 schemes ever created; LFRA 2024 and forthcoming Commonhold Bill aim to make commonhold default for new-build flats; letting a commonhold flat — check CCS for subletting rules; Scotland: title conditions and Tenements (Scotland) Act 2004.

8 min readUpdated 7 June 2026Last reviewed: 17 May 2026commonholdleaseholdflat ownershipLFRA 2024

How commonhold works — unit, association and CCS

Each flat is a 'commonhold unit' — a separate freehold title registered at Land Registry; no lease; no landlord above the unit-holder. Common parts (stairwell; roof; foundations; shared services) are owned by the commonhold association — a company limited by guarantee; all unit-holders are members automatically. The Commonhold Community Statement (CCS) is the governing document (registered at Land Registry): specifies unit boundaries; commonhold assessment contributions; permitted alterations; subletting rules; association powers. Commonhold assessment: equivalent to service charge — contributions in proportions set by CCS; dispute resolution via county court under CLRA 2002.

Why commonhold is rare, LFRA 2024 and landlord implications

Only approximately 20-30 commonhold schemes created in England and Wales since CLRA 2002 came into force in 2004. Reasons: lenders unfamiliar with commonhold; developers preferred leasehold (ground rent; management fee revenue); converting existing leasehold requires unanimous consent (never achieved). LFRA 2024 (Leasehold and Freehold Reform Act 2024): strengthens leaseholder rights (service charge transparency; right to extend; right to buy freehold) but does not mandate commonhold. The government has committed to a forthcoming Commonhold Bill to make commonhold default for new-build flats. Landlord implications: (a) new-build flat purchases — check leasehold vs commonhold title before exchange; (b) no lease expiry risk; no extension cost; (c) check CCS for subletting rules before letting; (d) market value of commonhold comparables is sparse — seek specialist valuation advice.

Frequently asked questions

What is commonhold and how does it differ from leasehold?+

Commonhold gives each flat owner a permanent freehold unit — no lease expiry; no ground rent; no lease extension required. Common parts are owned by the commonhold association (all unit-holders are members). Leasehold is a fixed-term interest that decays in value as the lease term reduces.

Can I let my flat if it is commonhold?+

Yes — check the Commonhold Community Statement (CCS) for subletting provisions first. Some CCS documents require notification to the association before letting; some restrict tenancy durations. CCS subletting restrictions are legally binding.

Will commonhold become the default for new-build flats?+

The government has committed to making commonhold the default for new-build flats in England and Wales — but this requires further primary legislation (a Commonhold Bill) beyond LFRA 2024. Direction of travel is clear; timing is uncertain.

Can an existing leasehold block convert to commonhold?+

Technically yes under CLRA 2002 — but unanimous consent of all leaseholders and the freeholder is required, which is almost never achieved. The Commonhold Council has consulted on lowering the threshold but no legislation exists yet.

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