Forum Topic

Buying a freehold

I've been offered the freehold of my property which is a house converted into 3 flats which I own.  There are 89 years on the lease currently, I have always paid a token service charge (£50 annually) as the freeholders do not do anything to maintain the property.  They are asking for £25k which I'm struggling to find due to high interest rates etc although they have gone down from £29k. Any suggestions from anyone especially with the new rules coming into place?  If it goes to auction what will happen?

Kaye Just ● 19d5 Comments

If you cannot borrow the money sell one of the leasehold flats and buy the overall freehold. Your bank would probably give you a bridging loan (if needed) if you have to buy the freehold first. The value of the two flats has immediately goes up in value significantly when you buy the freehold. Later on you can sell a lease extension to the person that you sold the flat to.

Sam Hearn ● 16d

thanks for the advice.  As I do own all the flats & the freeholders approached me, I did an online calculator & decided that £24k was a fair price so i'll move forward.

Kaye Just ● 19d

However, small print in legislation suggests that, ‘Someone who is a tenant of three or more flats in the building (as leaseholder or tenant) will not be a qualifying tenant of any of the flats and will not be entitled to the Right of First Refusal’...so this offer might be outside RFR arrangements, so definitely see a solicitor. If you have one of three flats, then RFR would apply and a majority of leaseholders could go forward with it.

Peter Evans ● 19d

You own all three flats?  As a leaseholder, you are at least being offered Right of First Refusal presumably with a Section 5 Notice, and it can only be offered elsewhere if you don’t take it up within the timescale. As suggested, get professional advice as it’s a  fiddly process.

Peter Evans ● 19d

See a solicitor is best course, if you buy the freehold, you will still have a lease, but you could all agree to increase it to 999 years. Shared freeholds can be hard work at times, as all freeholders need to agree on repairs, but better to own the freehold than not. Excuse syntax, I type on an iPad so edits are always a pain!

Russell Pearson ● 19d

Look up the Leasehold Advisory Service and put "freehold purchase" in the search box.

Paul Charlton ● 19d