UK plans to abolish leasehold, but commonhold shift looks difficult

The Law Commission says fewer than 20 commonhold developments have been created since the legislation came into force. The government wants commonhold to replace leasehold for flats, but the scale of the existing leasehold stock, the weakness of commonhold’s track record, and the unfinished state of the law make the shift far harder than the slogan suggests.

Why leasehold has become a political target

Leasehold gives a buyer ownership for a fixed term, often 99 or 125 years, rather than outright ownership of the land beneath the home. That structure has long been criticised because a landlord, not the flat owner, often controls key decisions on management, service charges and costs. The Law Commission estimates there are more than 4 million leasehold homes in England alone, which makes any attempt to replace the tenure a national housing change, not a niche legal adjustment.

The political pressure has built for years. Parliament has already passed the Leasehold Reform (Ground Rent) Act 2022, which ended ground rents for most new residential leasehold properties in England and Wales. Then came the Leasehold and Freehold Reform Act 2024, which received Royal Assent on 24 May 2024 and was meant to make lease extensions and freehold purchases easier and more transparent. Most of that act’s provisions are still not in force.

What commonhold is meant to solve

Commonhold was introduced in England and Wales in 2002 as the main alternative to leasehold for flats. In principle, it replaces a time-limited tenure with indefinite freehold ownership of a unit inside a jointly managed building. The building is owned and governed by the owners themselves rather than by a separate landlord.

In practice, commonhold has barely taken hold, and most flats in England and Wales continue to be sold leasehold.

The latest reform package

The government set out its next move in a Commonhold White Paper published on 3 March 2025. It proposed making commonhold the default tenure for future flats once the new framework is in place and banning leasehold for most new flats. A draft Commonhold and Leasehold Reform Bill was published on 27 January 2026 to push that agenda forward and to make conversion easier for existing leaseholders.

The timetable remains uncertain because the legal structure still has to be rewritten in detail, and the current system still governs most homes in the pipeline.

Why the transition is legally difficult

The government itself has acknowledged that leasehold reform is not a simple legislative switch. In November 2024, the Ministry of Housing, Communities and Local Government acknowledged that some provisions in the 2024 act had serious flaws and would not operate as intended without further legislative work. That matters because it shows the reforms are not just awaiting commencement; some need redesign.

Commonhold is also a more demanding legal framework than it can appear from the outside. It changes the ownership model, the rules for building management, the way disputes are handled, and the way conversion works for existing blocks. The government’s 2025 white paper and 2026 draft bill rebuild the machinery around it, with stronger protections, simpler conversion rules and management reforms meant to address the weaknesses that kept it from spreading after 2002.

The financial and practical obstacles

The difficulties are not only legal. Existing leasehold homes are tied to mortgages, service-charge structures, management companies and block-by-block ownership arrangements that cannot be unwound quickly. Lenders care about how buildings are governed and how risks are allocated, so any new commonhold model has to be clear enough to reassure the mortgage market as well as buyers.

Homeowners may welcome the idea of owning freehold-style rights indefinitely, but existing leaseholders still need a workable conversion route. Developers need a system that is simple enough to sell and finance new flats. Lenders need certainty that the new tenure can be valued and enforced. Local governance also matters, because building management and dispute resolution do not disappear when leasehold does.

Why the politics are easier than the delivery

The politics of ending leasehold are straightforward because the system has a bad reputation and commonhold sounds fairer. The implementation is harder because the old system is huge, the replacement has not scaled, and the law has to deal with both new flats and millions of existing homes at the same time. The Law Commission’s 2020 report, Reinvigorating commonhold, and the government’s later white paper both point in the same direction, but the gap between policy ambition and operating reality is still large.

Industry bodies have broadly accepted the direction while pressing for stronger design. The Law Commission welcomed the March 2025 move as a step toward its recommendations. Propertymark also backed making commonhold the default tenure, while urging practical strengthening of the draft reforms. The Royal Institution of Chartered Surveyors called the measures an important step. There is not yet a published timetable for all measures in the 2024 act.