A legal body is investigating why commonhold, which it says offers several advantages to leasehold, isn’t more popular.

The Law Commission, an independent legal body, said it was launching an eight-week call for evidence to try and establish what the obstacles to more people taking on commonholds were.

Commonhold was introduced in 2002 and allows a person to own a freehold “unit” — such as a flat within a building — and at the same time being a member of the company which manages the shared areas and buildings.

Despite this, some 98% of all transactions for flats in 2016 were leasehold.

By contrast, fewer than 20 commonhold developments have been created since the law came into force in 2004.

The Law Commission said it was asking flat owners, housebuilders, mortgage lenders and lawyers to shape a law which could help people own their flats outright.

Law commissioner professor Nick Hopkins said: “It’s clear leasehold law is a problem with some managing agents charging over the odds for the upkeep of shared areas, and the process of extending a lease costly and time consuming.

“Commonhold provides an alternative — giving unlimited ownership of a property and a stake in how the rest of the building or shared area is managed. But less than 20 have been created in the last 14 years.

“We want to find out what’s stopping people, and how the law could be improved to make commonhold more common.”

There are now thought to be over four million leasehold properties in England but concerns are increasingly being raised about the ownership type.

A recent Goverment consultation on unfair leasehold practices received 6,000 responses.

The Commission will ask for views on three themes:

• What the difficulties in creating or converting to commonhold are
• What issues make commonhold unattractive to homeowners
• What issues make commonhold unattractive in the wider property sector

Following the call for evidence, the Law Commission plans a full consultation to address the technical legal reforms necessary for commonhold to succeed.

The Commission will focus solely on legal issues, but said it invited comments on what other steps should be taken to encourage the use of commonhold.

These wider issues will be considered by the Government separately to the Law Commission.

The call for evidence can be found here.