Proposed reforms to commonhold could face serious practical and legal challenges unless the government provides a clearer legislative framework, MPs have been told during scrutiny of the Draft Commonhold and Leasehold Reform Bill.
Mark Chick (main picture, inset), Director of the Association of Leasehold Enfranchisement Practitioners (ALEP), gave evidence to the Housing, Communities & Local Government Select Committee as part of its inquiry into plans to replace leasehold with a strengthened commonhold system.
The session focused on how the new regime would work in practice, particularly the conversion of existing leasehold buildings, which many professionals believe will be the most difficult part of the reforms. Representatives from RICS and the Law Society also gave evidence.
A key concern raised during the hearing was the overlap between the draft Bill and the Leasehold and Freehold Reform Act 2024, parts of which have not yet been implemented. Witnesses warned that without seeing the full set of proposed amendments, Parliament risks assessing the new legislation without understanding how the wider system will operate.
HANDLE WITH CARE
Chick told MPs that ALEP supports the move to reform leasehold but said the process must be handled carefully.
“ALEP’s position is that these proposed amendments should be available now so the draft bill can be considered in full.
“Without this context, there is a risk that Parliament is being asked to scrutinise an incomplete legislative framework, even though the success or failure of the proposed reforms will depend heavily on how the wider valuation and conversion mechanisms operate in practice.”
PHASED APPROACH
He said the biggest challenge will be converting existing leasehold buildings into commonhold, particularly where valuation rules and participation rights have not yet been finalised.
“Whilst the draft bill puts forward what we would describe as a significantly improved model of commonhold, ALEP believes many of the most important questions that will relate to the downstream implementation remain tied to conversion.”
ALEP told the committee that a phased approach would be the safest way forward, with commonhold first applied to new-build homes before being extended to existing developments.
Chick added: “ALEP welcomes the next phase of the Select Committee’s inquiry… and we look forward to continuing to work with MHCLG on the development of the draft legislation and its wider roll-out of commonhold.”
