A person who owns both a lease and a share in the freehold wears two different legal hats. It is important to recognise that the lease is not defunct. It is still the document which regulates the ownership of the flat and leaseholders should ensure they have a copy and understand it.
What happens when a freehold expires?
The freeholder owns the land the property is built on, which means you, as a leaseholder, have to pay ‘ground rent’. Once the lease expires, the property reverts ‘back’ to being a freehold property, where both the building and the land it is on are under the ownership of the freeholder.
Why would a flat be freehold?
Benefits of owning the freehold to your flat: You control service charges: you can choose value for money, quality providers. No ground rent: you normally don’t pay ground rent. Fewer conditions: leases can come with a number of terms, e.g. you may normally need permission to sublet or have a pet.
Can a flat be a freehold?
Freehold is typically for houses and leasehold is usually for flats. Freehold means that you own the land and the building that sits on it. Leasehold means that you own a lease, which is a contract that gives you the right to live in the property for a set number of years (for example, 99, 125 or 999 years).
Does a freehold have a time limit?
There is also no time limit to worry about – with a leasehold there can be a countdown to a possibly expensive renewal, or a fear of decreasing value as the lease runs out, whereas buying freehold is permanent.
What does buying the freehold of a flat mean?
What does buying the freehold mean? Leaseholders of flats have a joint right, with other flat-owners in the block, to buy the freehold of their building. This is known as a right of “freehold enfranchisement” and it means that the leaseholders become their own freeholder.
What kind of house can I buy with freehold?
When it comes to freehold purchase a house can be one of many things – a pub with accommodation upstairs, a shop with a flat, offices with a flat, a block of flats – as well as your standard house.
Do you have a right of first refusal on a freehold property?
There are different legal steps and rules depending on whether your home is a: flat – you’ll need to buy a share of the freehold Landlords who want to sell the freehold of a building containing flats usually have to offer the leaseholders the first chance to buy it. This is known as your right of first refusal.
Who is the owner of a freehold property?
When you purchase a freehold property, you also own the land it was built on, along with the house itself. If the property is an apartment, the home owner becomes a shareholder in the property. You have the right to live in the house as long as you wish and you can also make changes to it.
