Property Owners to Gain More Control via Commonhold Model

The Commonhold model provides property owners with greater control over decisions that are made about the management of their building, known as a Commonhold Association.

Housing Secretary, Robert Jenrick, announced the launch of a new advisory panel is to be chaired by Building Safety Minister, Lord Greenhalgh, who will advise the UK government on future Commonhold property ownership. The newly created council will include the Leasehold Knowledge Partnership, the National Leasehold Campaign, UK Finance and the British Property Federation, bringing their expertise in readiness for the introduction of the Commonhold tenure within the housing sector.

The government set out its intention to restrict ground rent for new residential long-leasehold property to a peppercorn, announced in the Queen’s Speech. Earlier this year, the government announced changes where any Leaseholder can extend the lease on their Leasehold property by 990-years on payment of a premium and will no longer pay ground rent to the Freehold owner, providing greater security for Leasehold property owners.

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Leasehold Property Reform

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This is part of the most significant reform to English property law for 40-years and aims to provide property owners with more autonomy. The commonhold model provides a structure for property owners to collectively own the building their apartment is in, with a greater control over their building’s management, shared facilities and associated costs. There are no hidden costs, or, charges, which will prevent some of the bad practices currently seen in some Leasehold properties.

Housing Secretary, Robert Jenrick, commented, “We want to give homeowners across the country the autonomy they deserve. The new Commonhold Council launched today will, together with leasehold groups and industry experts, pave the way for homeowners in England to access the benefits that come with greater control over your home. We are taking forward the biggest reforms to English property law for 40 years and the widespread introduction of Commonhold builds on our work to provide more security for millions of existing leaseholders across England, putting an end to rip-off charges and creating a fairer system.”

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Commonhold Buy-to-Let Property

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The Commonhold tenure will provide buy-to-let property investors with greater control over the costs of managing the building that their apartment is in, a cost passed on to Leaseholders in the form of a service charge.

Exorbitant service charges can erode the net rental returns, decreasing the positive cash-flow from their buy-to-let property investment and profitability. Commonhold provides property owners with the ability to manage their investment property without cumbersome bureaucracy and unnecessary and unfair expenses.

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Click here to explore our buy-to-let property investment opportunities with 0.1% ground rent.

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Source: Property Reporter

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