Question 1

Commonhold

Accepted Answer

Commonhold Q: Last year FPRA provided us with opinions on various resolutions submitted to our AGM. which were very helpful. We are now approaching this year’s AGM. While we have received no resolutions to date, the rumour mill now suggests the same group are plotting again. Given the Australian connection of one of our owners we are surmising that commonhold is a likely topic, particularly as the couple concerned already have a dormant management company. We are a retirement village owned and managed by a company who also have other similar villages. While commonhold can be presented as allowing us to cast off the shackles of leasehold and become masters of our own destiny and fate by taking over the estate is this something we collectively wish to embark on at this stage of our lives? FPRA Committee Member Bob Slee replies The LEASE organisation has available a very comprehensive on-line guide on Commonhold which you can access following this link https://www.lease-advice.org/advice-guide/commonhold/ . You should also be aware that the Government is currently consulting on the future of leasehold and some revitalisation of the concept of commonhold (which has not thus far taken off to any marked degree in the UK) might well arise. Government reaction to that consultation, let alone consequent legislation, is likely to be years rather than months away. Without wishing to prejudge what might eventually emerge, there is a view that a polished-up concept of commonhold might well provide a suitable basis for multiple occupancy developments in the future – but it is not necessarily the panacea to shortcomings in existing leasehold developments. An alternative proposition, already available, is enfranchisement, ie common acquisition of the freehold by the lessees. That is the situation in the block that I am involved in managing and we have made it work very well and to our advantage. I can understand the concern about availability of sufficient interest to manage such a proposition, especially in a retirement block, but it would be quite usual for enfranchised companies to appoint managing agents to undertake practical management of the property. The difference of course would be that the agents would be appointed and directed by representatives of leaseholders and not a remote and possibly disinterested freeholder. [Submitted July 2019]

Question 2

Commonhold

Accepted Answer

Commonhold Q: Last year FPRA provided us with opinions on various resolutions submitted to our AGM. which were very helpful. We are now approaching this year’s AGM. While we have received no resolutions to date, the rumour mill now suggests the same group are plotting again. Given the Australian connection of one of our owners we are surmising that commonhold is a likely topic, particularly as the couple concerned already have a dormant management company. We are a retirement village owned and managed by a company who also have other similar villages. While commonhold can be presented as allowing us to cast off the shackles of leasehold and become masters of our own destiny and fate by taking over the estate is this something we collectively wish to embark on at this stage of our lives? FPRA Committee Member Bob Slee replies The LEASE organisation has available a very comprehensive on-line guide on Commonhold which you can access following this link https://www.lease-advice.org/advice-guide/commonhold/ . You should also be aware that the Government is currently consulting on the future of leasehold and some revitalisation of the concept of commonhold (which has not thus far taken off to any marked degree in the UK) might well arise. Government reaction to that consultation, let alone consequent legislation, is likely to be years rather than months away. Without wishing to prejudge what might eventually emerge, there is a view that a polished-up concept of commonhold might well provide a suitable basis for multiple occupancy developments in the future – but it is not necessarily the panacea to shortcomings in existing leasehold developments. An alternative proposition, already available, is enfranchisement, ie common acquisition of the freehold by the lessees. That is the situation in the block that I am involved in managing and we have made it work very well and to our advantage. I can understand the concern about availability of sufficient interest to manage such a proposition, especially in a retirement block, but it would be quite usual for enfranchised companies to appoint managing agents to undertake practical management of the property. The difference of course would be that the agents would be appointed and directed by representatives of leaseholders and not a remote and possibly disinterested freeholder. [Submitted July 2019]

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