In the second instalment of our International Insights series, we look at the proposals for commonhold reform in the UK and compare the suggested regime to similar co-ownership structures in other jurisdictions
Whilst we're still enjoying the last days of summer here in the UK, we're also looking forward to autumn and the developments in governmental policy and legislation that will no doubt start to emerge once the Parliamentary recess is over. One highly-anticipated proposal is the reform of the commonhold ownership system in the UK, as reported on in our blog from earlier this year. The White Paper published in March provided some details as to how the government intends to replace the existing leasehold system of ownership for residential properties with an updated commonhold regime, but those parties with an interest in the residential market are keenly awaiting the publication of the draft Leasehold and Commonhold Reform Bill, delivery of which was promised in the second half of this year.
Although the concept of commonhold ownership in England and Wales has been possible since 2004, take-up has been poor, due in a large part to the complexities of the legal framework. However, in many other jurisdictions, co-ownership models which are comparable to the commonhold structure have been embedded within the residential market for a number of years, and in some cases, are very much the norm for flats and condominiums.
In our latest International Insights briefing, our team in the UK provide a summary of the foundations for the revised commonhold framework and some of the anticipated complexities with the proposed reforms. Colleagues from Australia, France, Germany, Spain and the US have also provided insights into how co-ownership systems in these jurisdictions have tackled the difficulties facing the UK government when it comes to making this a functioning system. One can but hope that the UK can follow suit and devise a commonhold ownership system that works for both residents of multi-occupied residential buildings and those looking to develop and invest in a sector that is poised for further growth.
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