Commonhold and private estate reform: turning policy ambition into practical reality

While the principles behind the reform are widely supported across the sector, questions remain about how commonhold and wider private estate reforms will operate in practice, particularly within the complex developments that now characterise much of the UK housing market.

To explore these issues, FirstPort recently convened a roundtable bringing together senior representatives from more than twelve of the UK’s leading residential developers and housing associations. The discussion was co-chaired by Robert Courts KC, and Mairead McErlean, Head of Compliance and Regulatory Affairs at FirstPort, and focused on the practical realities of implementing commonhold structures and private estate reform.

While participants broadly welcomed the direction of travel, several key themes emerged from the discussion that policymakers will need to address if the reforms are to deliver their intended outcomes.

Education and expectations for flat owners

A consistent theme throughout the discussion was the need for greater education and awareness around what commonhold ownership actually means for residents.

Commonhold is sometimes presented as a straightforward alternative to leasehold. In practice, however, it fundamentally changes the role of flat owners, who collectively assume responsibility for the governance, maintenance and long-term management of their building.

Owners will need to ensure buildings are maintained safely, kept in good repair and adequately funded for future works. Without a clear understanding of these responsibilities, there is a risk that residents may underestimate the level of engagement and collective decision making required to maintain both building safety and the long-term value of their homes.

Ensuring that owners are fully informed about these obligations will therefore be critical to the long-term success of commonhold.

Building safety accountability

The discussion also highlighted the need for greater clarity around building safety responsibilities within commonhold structures, particularly for higher risk buildings.

Recent regulatory changes have introduced robust accountability frameworks for building safety. As commonhold associations assume ownership and management responsibilities, policymakers will need to ensure that safety duties are clearly defined and appropriately allocated.

Without clear governance structures, there is a risk that accountability could become fragmented, particularly in larger or more complex developments.

Managing complex and mixed-use developments

Modern residential developments are rarely simple single block buildings. Many comprise multiple buildings alongside shared infrastructure, commercial premises and a mix of tenure types including private ownership, shared ownership and social rented homes.

Participants noted that the current draft proposals appear heavily building focused and may not yet fully reflect how commonhold would operate within these more complex environments.

Several practical questions remain unresolved. For example, in a multi block development, would homeowners need to belong to two commonhold associations, one responsible for their individual building and another responsible for the wider estate infrastructure?

How would the framework operate where individual buildings convert to commonhold at different times? And at what stage would the management of wider estate areas transfer to a commonhold association?

Addressing these operational questions in legislation will be essential if commonhold is to function effectively across the types of developments now common throughout the UK.

Social housing and shared ownership considerations

The interaction between commonhold and social housing provision also emerged as an important area requiring further clarity.

Under current proposals, shared ownership leases are exempt from the ban on new leasehold flats, and shared owners will have the right to participate in commonhold associations.

However, housing associations are often the largest financial stakeholder within a building, particularly where there is a high proportion of socially rented homes. This creates questions around how voting rights and governance structures should operate to ensure that both resident participation and the legitimate interests of housing providers are protected.

Participants also raised concerns that, over time, poorly designed governance arrangements could unintentionally create pressure to separate socially rented homes from privately owned properties within developments. Avoiding such outcomes will be important to maintaining mixed and inclusive communities.

Introducing commonhold without fragmenting the market

Another key area of discussion focused on how commonhold should be introduced into the market.

A phased approach could allow the sector and policymakers to learn from early implementation and refine the system over time. However, some developers raised concerns that a gradual transition could influence buyer behaviour if purchasers delay decisions while waiting for commonhold properties to become available.

Conversely, a single implementation date for new flats would create a level playing field within the new build market, ensuring all newly constructed flats are sold under the same ownership model. However, as there is currently no proposal for mandatory conversion of existing leasehold flats to commonhold, a two-tier market between leasehold and commonhold properties will inevitably persist for the foreseeable future. Introducing a single implementation date would therefore provide clarity for developers and purchasers in the new build sector but would also require the industry to adapt rapidly to the new framework.

Striking the right balance between flexibility and certainty will be an important consideration as the reforms progress.

Reforming private estates and infrastructure adoption

Alongside commonhold, participants also discussed proposals relating to private estate management and the adoption of shared infrastructure.

There was broad support for the principle that areas used by the wider public, such as roads, drainage systems and open spaces, should ultimately be adopted and maintained by local authorities where appropriate.

However, if new adoptable standards or mandatory adoption requirements are introduced, the method used to calculate commuted sums will need to be standardised nationally. Current variation between local authorities can significantly influence whether developers choose to offer infrastructure for adoption.

Without a consistent approach, there is a risk that high commuted sums could deter development in some areas.

Participants also noted that certain developments intentionally provide higher levels of amenity or landscaping than standard adoptable infrastructure. In such cases, exemptions from mandatory adoption may remain appropriate to allow those enhanced environments to be maintained to the expected standard.

Turning reform into workable system

The direction of travel for residential property reform is clear. Greater transparency, stronger resident involvement and fairer arrangements for managing shared infrastructure are goals that command broad support across the housing sector.

However, as the roundtable discussion demonstrated, the success of these reforms will ultimately depend on how well legislation reflects the operational realities of modern residential developments.

Clear governance frameworks, well defined safety responsibilities and informed homeowners will all be essential to ensuring that commonhold can operate effectively in practice.

If these practical considerations are addressed as the legislation develops, commonhold has the potential to provide a durable and transparent ownership model for future residential communities.