As part of its wide-ranging leasehold reform agenda, the government has made clear its intention to breathe life into commonhold – a model that offers flat owners ownership of all shared areas, a perpetual title and collective control over their buildings.
With a new Leasehold and Commonhold Reform Bill on the horizon, there is an expectation that commonhold will become mandatory for all new-build flats.
But beneath the promise of a utopia lies a risk: that by leaping too quickly into a radically different system of ownership, unmanageable complexities are created for homeowners and unintended consequences for the wider property sector. If commonhold is to succeed, reform of the managing agent sector must come first.
A professional property manager
The leasehold system, for all its flaws, at least ensures that someone is legally responsible for the maintenance and management of a block. That might be the freeholder, who has a vested interest in preserving the value of their asset. Or, under the Right to Manage (RTM), it might be the leaseholders themselves. Typically, either party will appoint a professional managing agent to carry out day-to-day functions.
Under commonhold, responsibility sits entirely with the flat owners, who must collectively manage the building through a Commonhold Association. In some cases, this is exactly what the homeowners have wished for, but management requires time, expertise and consensus among the members. That example is rare. More commonly, whether it’s high-end developments, retirement schemes, situations in which many properties are unoccupied throughout the year, or residents simply don’t have the time or means to communicate on complex matters, owners will opt to outsource that responsibility. But they will do so without the guidance of a freeholder or management company – and crucially, without any guarantee that the agent they select is qualified, competent or accountable.
This matters because as commonhold becomes more widespread, managing agents will play a much more significant role while remaining physically remote from the buildings that they manage. Yet they are still unregulated: there is no legal requirement for training, qualifications, or membership of a professional body. My belief is that must change if we are to avoid overwhelming residents and undermining confidence in the commonhold model.
Commonhold: untested in practice
The appeal to commonhold is clear: it does away with ground rents, opaque service charges, and the distant landlord. Residents have genuine democratic control over their homes. Ownership is perpetual, not a diminishing asset. And the model encourages transparency and alignment of interests between neighbours.
But these theoretical advantages have yet to be fully tested in practice. Commonhold schemes remain extremely rare in the UK (it is said that there are more books on commonhold than there are instances of it), with few developers willing to adopt a model that generates no long-term income. Mortgage lenders remain cautious. Buyers and even many professionals are unfamiliar with the legal structure. And there are practical limitations in how commonhold deals with phased development, mixed-use buildings and corporate ownership structures.
Above all, there is a danger that the responsibilities placed on residents will prove too great. Managing a building, particularly under the weight of fire safety regulations and evolving compliance requirements, is complex and time-consuming. Without expert support, commonhold risks becoming not a utopia but a burden.
The case for regulation
If commonhold becomes the new norm, the support of experienced freeholders will vanish and thousands of buildings will require professional management. This is likely to lead to owner burnout, increased disputes, and a sharp rise in demand for professional managing agents. And yet, unless the role of the managing agent is seen as a profession, with all the credibility that brings, we are likely to experience a dearth of managing agents, while those that do exist will be unqualified and unaccountable.
We have seen what happens when leaseholders take on responsibility for management without sufficient expertise. Disputes arise. Management committees fracture. In cases of corporate ownership, legal advice is often required just to determine decision-making structures. Add in the requirements of the Building Safety Act and it becomes clear that professional property management is no longer an informal or optional role.
That is why the government’s consultation on mandatory qualifications for managing agents – closing this September – is so critical. If successful, we could see the introduction of an independent regulator, a licensing regime, compulsory CPD and access to redress through an ombudsman. These are vital steps towards ensuring that managing agents can be trusted with the responsibilities that commonhold will demand.
But timing matters. If commonhold is mandated before managing agents are reformed, we risk handing responsibility for complex and valuable buildings to individuals and organisations who are not yet equipped for the task.
Striking the balance between autonomy and support
Returning to the ‘utopia’, commonhold is not designed as a corporate model. Its purpose is to empower residents: to give them full control over their buildings and the freedom to self-manage if they choose.
But for many, that ideal will prove unsustainable. Disputes are common in co-managed buildings. Personality clashes can stall decisions. And when complex legal or technical issues arise, self-managed groups may lack the capacity to respond effectively.
Professional support will be essential – and when it is required, it must be available, competent, and subject to clear standards. A fallback arbitration system may also be necessary to resolve disputes where consensus breaks down.
The cause and effect dilemma
Another important consideration is the cause and effect dilemma (otherwise known as the ‘chicken and egg’ dilemma): if managing agent regulation is to be part of the Leasehold and Commonhold Reform Bill, it cannot precede the legislation itself. But if commonhold is to depend on professionalised management, then regulation must be in place before the model is rolled out.
So there is a strong case for a standalone piece of legislation on managing agent reform – one that lays the groundwork for a more professional sector in advance of commonhold becoming mandatory. This would ensure that when the time comes, residents, developers and legal professionals are all working within a framework that supports long-term building health, financial clarity and public confidence. It also means that professional managing agents could be consulted upon in relation to the future Commonhold Bill.
Legal and property professionals have an important role to play. If commonhold is to succeed, its practicalities must be stress-tested. Training, precedent and best practice will be essential to avoid the inertia that currently plagues the system. In short, the sector must move in lockstep with legislation – not scramble to catch up.
Conclusion
Commonhold has the potential to be transformative. But it cannot be implemented in a vacuum. Without regulated, professional managing agents, we risk burdening homeowners with responsibilities they are ill-equipped to shoulder, undermining the very model intended to empower them. But for commonhold to thrive, managing agent reform must not follow in its wake. Putting in place the means of enabling commonhold and ensuring that the requisite professionals will be available to deliver on it must take precedence over any political imperative to ‘ban leasehold’ ahead of the next general election.
First published – Estate Agent Today – Commonhold Won’t Work Without Managing Agent Reform – 4 October 2025