Commonhold vs Leasehold: What It Means for Value

Commonhold solves the problem that drives most of the concern in our short lease value guide — because there is no lease to run down in the first place.

What commonhold actually is

Under commonhold, a flat owner holds their unit outright, forever, with no lease and no separate freeholder — shared parts of the building are owned and managed collectively by a commonhold association made up of the unit owners themselves, broadly similar in principle to how strata title or condominium ownership works in some other countries.

Why it remains rare in the UK

Commonhold was introduced via the Commonhold and Leasehold Reform Act 2002, but take-up has been very low in the decades since, for a mix of structural, lending-market, and conveyancing-familiarity reasons that go well beyond the scope of a valuation question. The overwhelming majority of UK flats remain leasehold.

Recent reform direction

More recent leasehold reform legislation has signalled an intention to make commonhold the standard ownership model for new flats going forward, reducing reliance on leasehold over time — though the pace and practical detail of that shift continues to evolve, and existing leasehold flats are not automatically converted.

What it means for value

A commonhold unit does not carry the lease-length value discount that affects leasehold flats as their lease shortens (see our short lease property value guide for how significant that discount can become), and there is no ground rent or freeholder relationship to factor in. The trade-off is unfamiliarity: because commonhold remains uncommon, some valuers, lenders and conveyancers have less direct experience with it than with standard leasehold, which is worth being aware of if you encounter one.

What to check if you find a commonhold property

Confirm with the seller's solicitor that it is genuinely commonhold (not simply a long lease being described loosely), and check that your chosen lender and conveyancer are comfortable handling it, given how uncommon it still is in practice. See our leasehold vs freehold guide for the standard comparison this guide is building on.

Frequently asked questions

What is commonhold ownership?

A flat owner holds their unit outright, forever, with no lease and no separate freeholder. Shared parts of the building are owned and managed collectively by a commonhold association of the unit owners.

Why is commonhold still rare in the UK?

It was introduced via the Commonhold and Leasehold Reform Act 2002, but take-up has been very low since, for a mix of structural, lending-market and conveyancing-familiarity reasons. Most UK flats remain leasehold.

Does commonhold avoid the short-lease value problem?

Yes. Because there is no lease at all, a commonhold unit does not carry the lease-length value discount that affects leasehold flats as their remaining lease term shortens.

What should I check if I am buying a commonhold property?

Confirm with the seller's solicitor that it is genuinely commonhold rather than a long lease, and check that your chosen lender and conveyancer are comfortable handling it, given how uncommon it still is in practice.