The Law Society has responded to the Law Commission’s consultation on ‘Reinvigorating commonhold: the alternative to leasehold ownership’.
The Law Commission’s proposals to make commonhold an attractive alternative form of property ownership may not be enough to reinvigorate it, the Law Society has warned.
Commonhold allows a person to own a freehold flat, and be a member of the company which owns and manages the shared areas and structure of the building. However, it has struggled to gain traction – fewer than 20 commonhold developments have been built in England and Wales since it was introduced in 2002.
The system has been criticised for not being flexible enough to cater for larger, more complex developments. Mortgage lenders are reluctant to lend cash against commonhold properties because of legal issues.
The government asked the commission to come up with reforms to reinvigorate commonhold as a workable alternative to leasehold for existing and new homes.