A: Buying a share of freehold means that you will acquire a shared ownership of the freehold title relating to the building, as well as a leasehold interest in the individual flat. … Owning a share of the freehold also means that the lessees can have greater control of the day-to-day management of the building.
Is share of freehold a good thing?
Are there any benefits to having a share of freehold? In short, yes. Having a share of freehold gives you greater control over things such as maintenance obligations which removes the possibility of being taken for a ride by an unscrupulous landlord.
Do you pay ground rent if you have share of freehold?
When you have a share of freehold property, the lease is very important if you wish to take out a mortgage on the property. … This includes extending the lease to 999 years for no premium and reducing the ground rent to a peppercorn (so in effect you do not pay ground rent).
Does share of freehold add value?
Gaining share of freehold could add value to your property if your lease is short (85 years or below). … Share of freehold could also add value to your property if you feel that the building will be better run as a result. A well-managed and maintained building can add value to every property within it.
Is a freehold flat bad?
There’s nothing wrong with a freehold flat per se. The problems are down to mortgage lenders. Most of them don’t see a freehold flat as good security, a problem to mortgage as well as difficult to sell. In fact, very few lenders will even consider loans against them.
How does share of freehold work?
Whilst you will also have a share in the freehold, what you actually own is a share in the company that owns the freehold – this means that you own it together with all the other leasehold owners (usually). When you come to sell, your buyer will be buying your leasehold title from you and your share in the freehold.
Are freehold flats worth more?
Freehold is often more expensive than leasehold at the outset. Similarly, freehold often applies to houses rather than flats, so they are naturally more expensive.
How do I extend my lease with share of freehold?
If you are lucky enough to own a flat and a share of the freehold the good news is that the process of extending is relatively straightforward and the costs are fixed (and low). The first step is to agree this with the co-owners. You cannot usually act alone however extending the lease will benefit everyone.
Can you own the freehold of a flat?
Buying the freehold to your flat isn’t something you can do on your own though, to qualify you have to get your neighbours involved too. By law, at least half of the leaseholders in the building must come together to purchase the freehold.
How do I know if I own the freehold?
Alernatively, you can go to the Land Registry website and search for an entry for your property. Most property is registered and you should be able to obtain a copy of your title who will confirm whether the property is freehold or leasehold.
Why do lenders not like freehold flats?
The basic problem is that most lenders will not accept a freehold flat as ‘good security’and therefore they are a problem to both mortgage and sell. … It also makes the flat more expensive to remortgage because there are very few lenders who will lend on it.
How does share ownership work?
Shared ownership allows you to buy a share of your home, with a lower deposit, smaller mortgage and monthly payment on the rest. You start by buying between 25% – 75% of your home. That means your monthly mortgage and deposit are smaller than they would be if you bought your home outright.
How long does it take to buy a freehold property?
How long does the process take? It normally takes around six months to purchase the freehold from start to finish. It can take longer if it is necessary to make an application to the court or a tribunal.