These days, commonhold properties are becoming common in the UK. People want to live in flats but still retain the right to manipulate their units to their advantage. Most types of ownership do not come with this benefit. Commonhold properties give the owners almost as much freedom as freehold properties. However, freehold properties tend to be more expensive than commonhold properties. A homeowner needs enough freedom around his property without bearing the substantial financial obligations of a freehold.
Benefits of the commonhold property
A commonhold property owner can change the structural components of his living room at his wish. He does not need permission from the landlord or other members of the commonhold. He can install a fireplace or an aquarium in the living room at his pleasure. He does not have to seek approval from the landlord. He, however, has to bear the cost of constructions.
A commonhold property does not have to pay rent every couple of months. Paying rent every month can be inconveniencing. It is even worse when the property owner is a businessman. Business profits fluctuate from time to time. Sometimes the businessman can incur losses. A business owner may not be able to pay rent when his business is doing poorly. Tenants must pay rent regularly. Failure to pay rent can result in litigation and even more financial loss for the tenant.
Termination of commonhold property
Termination of commonhold property is not easy. Solicitors avoid conveyance of commonhold properties because of the workload involved. Those solicitors who agree to help in the buying and sale of commonhold properties charge a lot for conveyance. A commonhold property owner can stay in his unit for as long as the leaseholder. The difference is that a commonhold property, unlike leasehold property, does not depreciate in value at the end of ownership.
Commonhold owner rights
Commonhold owners have the right to change common areas in the property. A Commonhold Article gives owners the right to change common areas in the property. Each member of the commonhold has a vote in the property. This vote is his voice in the property. He can collude with similar minded people to effect major changes in the property. He might not have the freedom of freehold ownership on paper, but the freedom can be sought by negotiation and persuasion of other members of the property. Therefore, the owner of the property technically has as much liberty in the property as a freehold owner.
A commonhold owner can sell his unit without having to be barred by the landlord. He might notify the owner and the real estate agent but is not obliged to get approval from them. He will be the seller of a property that is actually owned by another person. Of course, the landlord and the real estate agent must know of the sale. Other members of the commonhold could also be notified of the sale. However, his right to sell his unit is not severely limited by these parties. The new owner must ensure that he knows rules and regulations stipulated in a Commonhold Article before he buys the property.