Commonhold is a system of property ownership in

England England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe b ...

and

Wales Wales ( cy, Cymru ) is a Countries of the United Kingdom, country that is part of the United Kingdom. It is bordered by England to the Wales–England border, east, the Irish Sea to the north and west, the Celtic Sea to the south west and the ...

. It involves the indefinite

freehold Freehold may refer to: In real estate *Freehold (law), the tenure of property in fee simple *Customary freehold, a form of feudal tenure of land in England *Parson's freehold, where a Church of England rector or vicar of holds title to benefice p ...

tenure of part of a multi-occupancy building (typically a

flat Flat or flats may refer to: Architecture * Flat (housing), an apartment in the United Kingdom, Ireland, Australia and other Commonwealth countries Arts and entertainment * Flat (music), a symbol () which denotes a lower pitch * Flat (soldier), ...

) with shared ownership of and responsibility for common areas and services. It has features of the

strata title Strata title is a form of ownership and housing tenure devised for multi-level apartment blocks and horizontal subdivisions with shared areas. The word "strata" refers to apartments being on different levels. Strata title was first introduced ...

and the

condominium A condominium (or condo for short) is an ownership structure whereby a building is divided into several units that are each separately owned, surrounded by common areas that are jointly owned. The term can be applied to the building or complex ...

systems, which exist in

Australia Australia, officially the Commonwealth of Australia, is a Sovereign state, sovereign country comprising the mainland of the Australia (continent), Australian continent, the island of Tasmania, and numerous List of islands of Australia, sma ...

and the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...

respectively. It was introduced by the

Commonhold and Leasehold Reform Act 2002 The Commonhold and Leasehold Reform Act 2002 (c.15) is an Act of the Parliament of the United Kingdom. It introduced commonhold, a new way of owning land similar to the Australian strata title or the American condominium, into English and Welsh ...

as an alternative to

leasehold A leasehold estate is an ownership of a temporary right to hold land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord. Although a tenant does hold rights to real property, a l ...

, and was the first new type of legal estate to be introduced in

English law English law is the common law legal system of England and Wales, comprising mainly criminal law and civil law, each branch having its own courts and procedures. Principal elements of English law Although the common law has, historically, be ...

since 1925. An important difference between commonholds and leaseholds (leases) is that commonholds do not

depreciate In accountancy, depreciation is a term that refers to two aspects of the same concept: first, the actual decrease of fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wear, and second, the ...

towards the end of their term (''

term of years A leasehold estate is an ownership of a temporary right to hold land or property in which a lessee or a tenant holds rights of real property by some form of title from a lessor or landlord. Although a tenant does hold rights to real property, a l ...

'' or in extraneous documents sometimes ''existence''). In the years since the 2002 Act became law, only a handful of commonholds have been registered, whilst hundreds of thousands of long leases have been granted during the same period. As of 3 June 2009, there were 12 commonhold residential developments comprising 97 units (homes) in England and one commonhold residential development comprising 30 units (homes) in Wales.

House of Commons of the United Kingdom The House of Commons is the lower house of the Parliament of the United Kingdom. Like the upper house, the House of Lords, it meets in the Palace of Westminster in London, England. The House of Commons is an elected body consisting of 650 me ...

, Where freehold houses should be subjected to

positive covenants A positive covenant is a kind of agreement relating to land, where the covenant requires positive expenditure by the person bound, in order to fulfil its terms. See also *English land law *Equitable servitude *Easement *Restrictive covenant A ...

which force their owners contribute to communal maintenance, such as in

garden square A garden square is a type of communal garden in an urban area wholly or substantially surrounded by buildings; commonly, it continues to be applied to public and private parks formed after such a garden becomes accessible to the public at large. T ...

s, as few such duties can attach to freeholds, access to such areas can be physically restricted to those who own that area, commonly through a residents' management company. Such a company, if the land was owned by the original landlord such as a developer, may come into the hands of the lessees (tenants) through a statutory process leading to legal agreements or a court order which creates a limited liability

right to manage In the United Kingdom the Commonhold and Leasehold Reform Act 2002 provides a right for leaseholders to change the appointment of the management of their building to another provider, by setting up a special company to take over from the freeholder ...

(also known as an RTM) company. A common alternative has been

rentcharge In English property law, a rentcharge is an annual sum paid by the owner of freehold land (terre-tenant) to the owner of the rentcharge (rentcharger), a person who need have no other legal interest in the land. They are often known as chief rents ...

s where truly necessary services or contributions need to be made which cannot devolve to a local authority or statutory undertaker through ''adoption''.

References

Property law English law Condominium English property law {{UK-law-stub