Category Archives: Buying the Freehold

Information for leaseholders and freeholders about purchasing the freehold of a property through collective enfranchisement.

What is Freehold? and How do I Buy My Freehold?

I recently recorded a podcast with the website Property Battlefield that looked at the question of ‘What is freehold?’ and also how flat owners can go about buying their freeholds.

To download a copy of the podcast click here: Podcast – “What is freehold?”

The discussion was about why we have freehold. It also looks at the two main ways in which leaseholders can buy their freeholds. This tends to be either under the Landlord and Tenant Act 1987 where the landlord serves a notice seeking to sell, or to obtain clearance for a sale, or under the the Leasehold Reform Housing and Urban Development Act 1993. In the second case, the flat owners serve notice on the landlord.

Both options present a range of issues that need to be considered, including pricing and timing.

Property Battlefield is a site run by John Savage that provides information for estate agents and other property professionals although the topics covered in the podcast will be of interest to property investors, managers and anyone looking to buy their freehold or find out more about buying the freehold to their block.

 

Missing freeholders: a webinar and podcast

 

A while ago I recorded a podcast for LEASE (the Leasehold Advisory Service) on the subject missing freeholders and how to buy your freehold if you happen to be in this situation.

You can listen to the podcast here: http://www.lease-advice.org/publications/documents/document.asp?item=149

This week I was delighted to provide a webinar for News on the Block, a recording of which can be found here:

http://propertycpd.tv/events/missing-freeholders-how-to-extend-your-lease-or-buy-your-freehold-when-the-landlord-cannot-be-found/

This webinar is aimed at flat owners and managing agents / estate agents and looks at some of the practical issues involved. It also explores the available options under the 1993 Act and the 1987 Act.
Missing freeholders continue to present a range of problems In practice.

Landlord’s Offer Notices Under Section 5B of the Landlord and Tenant Act 1987

I recently wrote about this issue in an article that appeared in Landlord and Buy to Let Magazine, see:

http://www.joomag.com/magazine/landlord-buy-to-let-magazine/0540853001421676588?short

However, Section 5B is an issue that is worth considering, as this means that the freehold in your building will go to auction. You may (collectively) have the right of ‘first refusal’ against any successful bidder.

So, should you do anything about this?

The answer is, it depends. If the price is right then this may well be an ideal opportunity to buy out the freehold to your building, but to know this you may need valuation advice.

Secondly, the price will not be set until the auction and therefore, you may well need to attend to watch and see how the pricing is going. Generally you are better off not bidding, but if the property is sold in the room on the day then you will have the same right that any auction buyer will have – normally to complete the purchase within 28 days of the auction sale. It may be necessary to bid if the property will not reach its reserve.

Remember, this is a collective right and therefore a majority (more than 50%) of flat owners are needed. The next problem is that because you need to complete quickly at the end of the process, you will need all the funds in line before the auction date to be able to complete. You will not know the exact price until the sale room process is complete.

If you do want to go down this route, then the first step is to serve an acceptance notice (which needs more than 50%), there are then several other procedural steps to go through to protect your position. You will need a company (most likely) to be your purchase vehicle and there will be other notices to be served. In other words, you will definitely need professional assistance from a solicitor.

In practice, this route can be used successfully to buy your freehold, but it does require proper planning and preparation and may require one or more participants to ‘forward fund’ the exercise. If you would like to know more, or have a specific question, by all means do get in contact with me to discuss.

http://www.joomag.com/magazine/landlord-buy-to-let-magazine/0540853001421676588?short

 

Section 5A offer Notices under the Landlord and Tenant Act 1987

I was pleased to have an article published in the current edition of Landlord & Buy to Let Magazine on the subject of offer notices under the Landlord and Tenant Act 1987.

These often represent the chance to purchase your freehold collectively at a lower transactional cost and provided that the ‘price is right’ then these are often worth considering.

In order to accept and act collectively (as you need more than half of the flat owners to participate), you will need to move quickly as there are only 2 months to co-ordinate the initial response. If there are a large number of flats, then do not underestimate this challenge, although in practice we have experience of dealing with large-scale transactions (100 flats plus in a block) experience shows acting early is essential if you are to succeed.

To read the full article see:

http://www.joomag.com/magazine/landlord-buy-to-let-magazine/0540853001421676588?short