If you own a flat in England or Wales, you probably own it on a lease. But what does that mean, and how is it different from freehold or commonhold? Here is a simple guide, along with where reform stands at 1 November 2026.
Freehold
A freeholder owns a property and the land it stands on, with no time limit. Most houses are owned this way. In a block of flats, the freeholder usually owns the building's structure and land, while the flats are sold on long leases.
Leasehold
A leaseholder has the right to occupy a property for a fixed period under a lease. The lease sets out what you own, what the landlord must do, and what you must pay.
It commonly covers service charges, repairs, insurance and any ground rent. The landlord or a management company usually looks after the shared parts, often with a managing agent.
Leaseholders are not stuck with the terms forever. They may have rights to extend their lease, buy the freehold together or take over management through the Right to Manage.
Commonhold
Commonhold was introduced by the Commonhold and Leasehold Reform Act 2002. Each flat owner owns their unit outright, with no lease that runs down over time and no landlord. The owners run the shared parts through a commonhold association. The rules are set out in a commonhold community statement.
Few homes have been created this way so far, but the government wants that to change.
The quick comparison
| Freehold | Leasehold | Commonhold | |
|---|---|---|---|
| Time limit | None | Length of the lease | None |
| Landlord | No | Yes | No |
| Shared parts | Usually none | Landlord or management company | Commonhold association |
| Rules | Title and planning | The lease | Community statement |
What has changed so far
- The Leasehold Reform (Ground Rent) Act 2022 ended ground rents for most new residential leases.
- Since 31 January 2025, leaseholders have not had to wait two years after buying before extending a lease or buying the freehold.
- Since 3 March 2025, more leaseholders have qualified for the Right to Manage, and they no longer generally have to cover the freeholder's legal fees for a claim.
What has not changed yet
Most of the Leasehold and Freehold Reform Act 2024 is still not in force. The measures on standard lease extensions and the cost of buying a freehold, for example, still need further legislation.
The government published a draft Commonhold and Leasehold Reform Bill in January 2026. It proposes a ground rent cap and a ban on most new leasehold flats, with commonhold as the default. We could not find it among the Bills before Parliament at 1 November 2026, so it remains a proposal and may change.
The government has also said that better service charge transparency will be introduced as soon as possible from 2027.
What this means for you
For now, your lease still sets out your rights and obligations. Keep a copy, read the sections on service charges and repairs, and do not make plans based on reforms that have not yet become law.
This guide is general information for England at 1 November 2026, not legal advice. Your lease and your building's circumstances may change how it applies to you, and the law may change after this date.