Commonhold and AI reshape leasehold reform

The Association of Leasehold Enfranchisement Practitioners (ALEP) recently hosted its annual conference on 15 October, drawing over 240 professionals from the leasehold sector. This impressive turnout underscored the pressing need for leasehold reform, a topic of significant concern for solicitors, valuers, managing agents, and other stakeholders present at the event.

As the discussions unfolded, the anticipation surrounding the potential replacement of leasehold with commonhold became palpable within the conference hall. With the upcoming Leasehold and Commonhold Reform Bill on the horizon, many attendees were eager to explore the implications of such reforms. Speakers James Fieldsend from Tanfield Chambers and Mari Knowles of Commonhold and Leasehold Experts Ltd provided insight into the proposed “acquire and convert” process, utilising ALEP’s hypothetical apartment scheme, Hague House, to shed light on both its promise and its challenges.

A consensus emerged among experts regarding the necessity for caution in implementing commonhold in existing structures. There was a palpable understanding that introducing commonhold universally must be a gradual process, commencing with new developments and reinforced by thorough training for practitioners and comprehensive consumer education.

Another focal point of the conference was the role of Artificial Intelligence (AI) in leasehold reform, brought to life by Mike Somekh of The Freehold Collective. In his presentation titled “Leasehold enfranchisement just got (artificially) intelligent – evolve or be automated”, Somekh ignited lively discussions during lunch breaks. He characterised AI as “a colleague who never needs a coffee break” and underlined its capability in document analysis, drafting client care letters, producing valuations, and identifying legal precedents. According to a poll he cited, 61% of lawyers and 38% of valuers had already incorporated AI tools into their leasehold enfranchisement practices.

Despite AI’s advantages, such as outperforming humans in tasks like document summarisation and due diligence, participants were reminded of the associated risks. Issues surrounding fabricated case citations and data privacy highlighted the necessity for professional oversight. “The challenge and the opportunity is to evolve alongside AI rather than be replaced by it,” Somekh stated, urging attendees to “Invest time, upskill, collaborate and differentiate”.

Additional sessions at the conference covered vital topics such as company law for Right to Enfranchise and Right to Manage companies, tribunal preparation, and updates on the Building Safety Act. Prominent experts like Louise Park, Henrietta Hammonds, and Simon Allison KC provided invaluable insights into these areas, alongside Mark Loveday and Robyn Cunningham who discussed ongoing human rights challenges related to LAFRA, while Piers Harrison offered his popular case update.

Looking to the future, ALEP Director Mark Chick expressed thoughts on the balance of opportunity and challenge presented by the forthcoming draft Leasehold and Commonhold Reform Bill. Chick noted, “The increased use of commonhold is a certainty. The uncertainty is in how it is to be introduced, and this will determine its success.” He stressed ALEP's commitment to collaborating with both government and practitioners to ensure that reform initiatives are smoothly implemented and effective.

Chick also emphasised the irreversible nature of AI in the leasehold sector, urging professionals to engage with technology responsibly. “We approach this year’s conference knowing that the draft Commonhold Bill was not yet available to discuss. But the pace of both political and technological change has given us more than enough to consider”, he remarked. The current landscape for leasehold reform presents unique challenges, reinforcing ALEP’s critical role in navigating these transformative times in the profession. With over 1,200 members across 260 organisations, ALEP's focus remains firmly on advancing the discourse surrounding Leasehold and Commonhold Reform.