Flat freeholder wants to sell freehold

[trooperiziz]

I live in an apartment block with 8 properties in it, and have just had a letter to state that the current freeholder wants to sell the freehold, and has to give the current leasees first refusal.

I'm kinda interested in the prospect, but have no idea what it really means, apart from having control of our own destiny in some respect. However our lease does have 123 years left to run, so that isn't an issue.

Anybody been through this before and can tell me the upsides and downsides?

[trooperiziz]

oldbanger said:

We bought the freehold as a leaseholders co-operative (or something) at a previous place. There were 8 flats, with 8 leaseholders, each with an eighth share in the freeholding company/association (I forget the exact legal status, but to be fair this was about a decade ago now).

It was all done through a local solicitor fairly painlessly and didn't cost that much either, as I recall. It helped that the freeholder's agent had been rubbish at administering stuff, and we paid a premium for it in terms of commission on top of fees of work etc, so some of the residents were already actively maintaining the premises. In essence we were halfway there already in terms of organising ourselves. We continued to pay the same maintenance charges etc, except to the resident's association bank account instead, got to decide on our own schedule of improvement works and repairs, and were able to shop around for quotes.

My advice would be to do it, but YMMV

All good points, however a couple of things I probably should have mentioned in the first post I guess!

The freehold is up for £24k so it will cost me £3k minimum to buy into it, the flat is a newbuild (built just under 2 years ago) so maintenance costs are low and i'm not expecting any surprises in the time I am likely to be here, most likely no more than 5 more years I would guess.

Would owning part of the freehold mean the flat is worth more in the future? Would owning part the freehold be a good investment regardless of whether I sell it on with the flat when I sell, is that even allowed?

I think I need to talk to a solicitor really, but want to know what I need to know before I talk to him, I'm pretty clueless about all this to be honest

[trooperiziz]

oldbanger said:

trooperiziz said:

Would owning part of the freehold mean the flat is worth more in the future?

It did for us, but then the leases were getting to under the 60 year mark.

Absolutely, if my lease was anywhere close to that sort of number, it would be a no-brainer

[trooperiziz]

anonymous said:

[redacted]

Sure, that is all a possibilty, but buying our freehold wont change some of that. The block is basically 6 blocks joined together around a central courtyard, we have the option of buying the freehold for our block, i.e. 1 of the 6 blocks. Who will own the communal areas etc... I have no idea. But I'm almost certain it won't be our freehold, so can't stop whoever does own it from doing what they want, except through the legal channels and rights I have anyway, which won't change.

Making up work will be difficult, as mentioned it is a newbuild and still under NHBC guarantee etc... Plus we will always have the right to force a freehold sale in the future if it does get bought by a tt.

For me it comes down to simple economics, in the next 5 years I expect to be here, will the freehold cost of somewhere between £3k-£24k (plus fees) be clawed back in terms of possible overcharging shenanigans and increase in property value. In an older flat with a shorter lease that is completely independent of it's surroundings, I can see it is a no brainer, for a virtually brand new flat, with a long lease, that is surrounded by other plots of land that I wouldn't have the freehold for, does it make as much sense? I really don't know!

[trooperiziz]

anonymous said:

[redacted]

Well yes, but that is 400 properties. This is a block of flats with 8 people in it. Worst case I need to knock on 3 doors and start proceedings to force a freehold sale...