There are an estimated 4 million leasehold properties in the UK. As long as eligibility criteria are met, legislation makes it possible to buy your freehold. With a flat you are buying a share of the freehold and 50% of the other tenants would need to agree.
Although purchasing your freehold can be a complex process whether it is done formally or informally many property owners opt to buy their freehold for the following reasons:
1. Service charges may be reduced
2. Maintenance costs are decided by the freeholders
3. There is no annual ground rent to pay
4. If a lease falls below 80 years an extension can be expensive to extend
5. It may increase the value of the property
6. It may make the sale of the property smoother
7. It removes the management company, who make decisions on behalf of the leaseholder - the owner of the property will have greater control
8. There may be conditions with a leasehold property such as you cannot own pets or you need consent to an alteration - these conditions may be removed giving greater freedom
These reasons backed by the legislation which can be enforced via a formal process at first-tier tribunal make purchasing the freehold of property an increasingly attractive option for home owners.
With a flat, the new freeholders will need to set up a freehold company, do the accounts, arrange insurance as well as general upkeep. It is important that you are willing to do this otherwise, it may de-value the property moving forward. The more flats there are in a block the more difficult it can be to reach a consensus. There will need to be consensus on issues such as service charges so it is important to assess how feasible it will be to achieve this. There are some important responsibilities that come with owning the freehold, but many consider that the advantages far outweigh any draw backs.
If you do decide to purchase the freehold of your property it could take up to a year if negotiations are not straight forward. Our residential conveyancing solicitors can talk you through the possible benefits of owning your freehold, call us today on 0161 696 6229 to discuss how we can help.