When it comes to property ownership in England and Wales, things can sometimes get a little confusing. If you are the leaseholder of a flat, apartment or leasehold house, what do you actually own? What are your legal rights? How about if you live in a block of flats or a house divided into apartments? What is freehold purchase and when does enfranchisement (or collective enfranchisement) apply? What are the differences between freehold and leasehold?
Unless you’re a property expert, all of these terms and definitions can be confusing, and if you don’t feel you know the basic answer these questions when purchasing residential property, either as a home or an investment, you could end up regretting your decision to buy. Here’s a brief guide to the terms freehold, leasehold, and freehold purchase.
What Is Freehold?
Basically, owning the freehold of a house means that you own the actual building as well as the land it stands on. As a freeholder, you will be listed in the land registry as owning the ‘title absolute.’ The main benefits of being a freeholder over a leaseholder is that you won’t have to deal with a freeholder, so you won’t have to pay ground rent every year, you will be in charge of the maintenance of the building and can therefore choose who you hire to do repairs and so on, and you will find your home much easier to sell if you decide to move.
What Is Leasehold?
So what does leasehold mean? Basically, owning the leasehold means that you lease the house from the freeholder (generally this will be your freeholder). You will have a contract for however many years the lease term is for, and, subject to the terms of each individual lease, general responsibility for maintaining the common parts and overall fabric of the property [e.g. the roof and any shared entrance or passageway] will lie with the freeholder. This can be a good thing, but it can also be frustrating if the freeholder is slow to organise repairs or charges a lot for maintenance fees. The leaseholder will have to pay ground rent to the freeholder every year, in addition to a maintenance charge, and will often be faced with restrictions on their enjoyment of the property such as having to obtain permission to change the property or not being allowed pets and so on. Basically, leaseholders have a lot less control than freeholders.
What Does ‘Freehold Purchase’ Mean?
It may be possible as the owner of a leasehold flat/house to buy the freehold of your block. This – unsurprisingly – is called Freehold Purchase or sometimes Freehold, Collective or Leasehold Enfranchisement. You can force your freeholder to sell the freehold of the block of flats to you and some or all of your fellow leaseholders – as long as you meet certain criteria.
There are many reasons why people wish to purchase their freehold, with the advantages being many. For example, you won’t have to pay ground rent to your freeholder (or deal with them at all , as you now share the freehold ownership of the property), you can enjoy more security in your home without fear of eviction, and you can be in charge of the maintenance and management of your home without having to wait for your freeholder to do things. If you want to acquire the freehold on your house or flat, you’ll need to adhere to strict guidelines, so it’s vital to have a specialist solicitor on your side who can guide you through the whole process.
Finding Out More About Freehold Purchase
If you wish to find out more about the possibilities of freehold purchase, it is essential that you speak to a law firm with extensive experience in the area of property law. Only a relatively small number of law firms nationwide, like us here at Bonallack and Bishop, actually specialise in this area.
Selling Your Freehold to your Leaseholders|? Contact our specialists today
Exercising the right to buy your Freehold is complex and you will need expert legal advice. Our specialist teams can help you wherever you live. Contact our solicitors today for a FREE first phone consultation on your Freehold Purchase;
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