LKP holds commonhold meeting at Westminster

This was the first high-level discussion on the subject since 2002, when the Commonhold and Leasehold Reform Act was introduced. There has only been a limited take-up of commonhold, and a number of speakers at the event addressed how the system could work.

Among the input, property law QC Philip Rainey, argued that attempts should be made to fix the many issues in leasehold law, and warned that commonhold also faced some problems. James Driscoll, a professor of law who was part of the original advisory group on commonhold, took the meeting through a number of misconceptions on the subject.

Guy Fetherstonhaugh, property law QC, added that a housebuilder adopting leasehold effectively gets to sell an asset twice: when they sell the leases, then when they sell on the freehold reversion with its right to ground rent and other potential incomes. He also proposed that the Government should offer either incentives to build commonhold, or disincentives to building leasehold.

Philip Rainey suggested that perhaps ground rents could be abolished as an income stream on new build developments or, alternatively, that there be some relief on stamp duty for initial commonhold sales.

Martin Boyd said the Government had failed to use its influence in the social sector to help prime the commonhold system. At the suggestion of Sir Peter Bottomley a number of MPs have proposed to meet the Homes and Communities Agency to find out why it had not done more to promote commonhold.

According to the LKP, although there are some concerns over commonhold – particularly regarding weaknesses in legislation compared with what is already in place for leasehold – the meeting showed that it is a system that would be welcomed by the sector if it could be made to work.