Leasehold properties are a diminishing asset, which is why purchasing the freehold title of your house, terrace, maisonette or flat may be financially beneficial to you. It is more common for flats to be sold as leaseholds, but some new build houses can be sold as leaseholds too. Without owning the freehold title, it will cost each time you wish to extend the lease and you will have ongoing expenses to your freeholder for insurance, service charges and ground rent. In addition, some contract clauses may be unappealing to buyers, which could make your property unsellable.
Leasehold Enfranchisements
In short
Leasehold enfranchisement is the legal process of buying the freehold of your leasehold house or flat — either on your own, or together with other leaseholders in the building. Because a lease is a diminishing asset, owning the freehold outright can be a financially sound long-term move. Call 08082747557 for a free initial assessment, with no obligation to proceed.
Enfranchisement for houses
If you own a leasehold house — including a terrace or maisonette — you may be able to buy the freehold if your lease was originally granted for more than 21 years and you’ve owned the leasehold for at least two years. Once eligible, buying the freehold removes the lease altogether, along with any ground rent, and gives you full control over the property going forward.
Enfranchisement for flats
Flat owners usually pursue what’s known as “collective enfranchisement” — buying the freehold of the whole building together with enough of your fellow leaseholders. This is more involved than enfranchising a house, and typically requires:
- Enough qualifying leaseholders in the building agreeing to take part
- A formal valuation of the freehold, usually carried out by a surveyor — the price tends to be higher where leases are shorter
- Setting up a nominee purchaser or company to buy and hold the freehold on behalf of the participating leaseholders
- Legal fees and Stamp Duty Land Tax on the purchase, and potentially remortgaging costs for individual leaseholders
Thinking about buying your freehold? Call 08082747557 to find out if you’re eligible and what it involves.
The benefits of owning your freehold
Once enfranchised, you’re generally able to extend your lease (or your fellow leaseholders’ leases) up to 999 years free of charge, remove ground rent entirely, and take much greater control over how the building is managed. It also tends to increase the property’s value and make it easier to sell in future, since buyers are naturally drawn to a long lease with no ground rent.
If a full purchase of the freehold isn’t right for your building, it’s worth considering extending your lease instead, or exercising your right to manage the building without buying the freehold at all.
Related Services
- Extend the lease on your flat instead Leasehold Extensions
- Take over management of your building Right to Manage
- Understand your position as a leasehold owner Leasehold Properties
- Instruct a solicitor to handle your house move Conveyancing
- Get general advice on a housing dispute Housing Disputes