Commonhold Could Turn Neighbours Into Rivals

While this democratisation is meant to empower residents, it can also expose deep differences in priorities, financial capacity, and tolerance for risk. Everyday disagreements over repairs, noise, pets, or short-term lets are no longer abstract complaints but collective governance battles.

The UK government has formally committed to ending leasehold as the default tenure and making Commonhold the standard for new flats, publishing a Commonhold White Paper in March 2025 and a draft Commonhold and Leasehold Reform bill in January 2026, that sets out how this transition will work in practice. Over time, it is likely that existing leaseholders will be encouraged to move to Commonhold, although this will not be compulsory. The new legislation follows the Leasehold and Freehold Reform Act 2024, which received Royal Assent in May 2024 and is now being rolled out in stages across England and Wales.

Fewer than 20 commonhold developments currently exist in the UK, according to the most recent data. This translates to less than 200 individual commonhold units in total across England and Wales, based on figures from the government published Ministry of Housing, Communities & Local Government 2024 Commonhold White Paper.

By contrast, in 2023-24, there were an estimated 4.83 million leasehold dwellings in England. Leasehold properties are held under a lease, which is a legal agreement granting the right to occupy the property for a set period. This equates to 19% of the English housing stock, highlighting the enormous disparity between policy aspirations for commonhold expansion and its real-world uptake. Unlike commonhold, which has no expiring term and offers perpetual ownership, leasehold properties are subject to an expiring term, after which ownership reverts to the freeholder.

Despite repeated government commitments and policy enthusiasm for commonhold as an alternative to leasehold, the figures underscore just how rarely the tenure is used in practice. The law commission published a report outlining the challenges and potential solutions for commonhold reform. The government’s plans include making commonhold the default tenure for new flats and revitalizing existing commonhold law. 

The big difference between Commonhold and Leasehold is that each individual resident becomes a freeholder of their flat with the block managed jointly by all the flat owners (referred to as unit-holders) through a commonhold association with new rights and obligations.

Financial considerations are important sticking points. In Commonhold, residents must collectively agree on contributions for major works, insurance, and reserves. Those with greater means may push for proactive investment and high standards, while others may resist costs they cannot easily absorb. What was once a service charge dispute becomes a personal conflict: neighbours voting to raise each other’s monthly bills. Over time, this can foster resentment, suspicion, and accusations of selfishness or irresponsibility.

Time and competence also become sources of friction. Commonhold relies heavily on active participation, attending meetings, reading accounts, and understanding legal obligations. In practice, a small minority often carries the administrative burden, gaining informal power and influence. Others may disengage, then object when decisions don’t suit them. This imbalance can create cliques, personality clashes, and claims of dominance or exclusion, turning community governance into a social minefield.

There is also the issue of conflict escalation. Without a single external authority to absorb blame, disagreements are harder to defuse. A leaking roof or failing lift is no longer “the landlord’s problem” but a collective failure, with fault implicitly assigned to fellow residents. Minor disputes risk becoming entrenched, emotional, and long-lasting, especially in buildings where people cannot easily avoid one another.

Critically, Commonhold assumes a level of cooperation that may not reflect modern urban living. Many residents view their homes as private retreats or financial assets, not as participatory communities. When collective responsibility is imposed on people who neither want nor have the capacity to engage, friction becomes almost inevitable.

The draft Commonhold and Leasehold Reform Bill highlights how the intended implementation of Commonhold will lead to a worse situation for people than Collective Enfranchisement, the Leasehold equivalent. Amongst the many contradictory legislative clauses, (often described as “bonkers” by experts) is the legal requirement for directors to simultaneously ensure that unit-holders pay their charges, ensure the continued financial viability of the commonhold associate, ensure that minority rights are protected, ensure that the majority make all material decisions, ensure that unit-holder to unit-holder disputes are managed separately, whilst always acting to ensure “harmony” between unit-holders. These are legal requirements placed on volunteer (unpaid) directors, who, unlike leasehold directors, may find little incentive to take on the liabilities. 

That said, supporters argue that these tensions are growing pains rather than fatal flaws. With proper education, professional support, and clear dispute-resolution mechanisms, Commonhold could mature into a more transparent and fair system than leasehold ever was.

The risk is that without common-sense legislation and additional safeguards, the transition may replace one source of frustration with another, swapping distant landlords for very close, very human conflicts next door.

Mike Somekh, Founder and CEO of The Freehold Collective