Collective enfranchisement is the process by which leaseholders join together and buy the freehold of the building, according to the provisions of the Leasehold Reform & Urban Development Act 1993. As a leasehold property owner, typically of a flat or apartment, this may be well worth considering since the benefits of owning a share of the freehold can be substantial.
At South East Leasehold, we have helped numerous groups of leaseholders to buy their freehold and are fully acquainted with all that the collective enfranchisement process entails. Contact us to request a free consultation.
The first undeniable advantage of collective enfranchisement is the fact that you will part-own the grounds and the building that your flat forms part of, in legal terms. This gives you a lot more control over your home. For most leaseholders, the motivation for purchasing the freehold comes from being able to run their own affairs, and to have direct control of the management and the maintenance of the building.
This is most likely to have been carried out by the landlord’s managing agent prior to collective enfranchisement. Now, the management of the building is in the hands of the new collective freehold owners, with new powers of authority.
If you wish, you can instruct your own property management company, and choose the level of service charges for the provision of essential services such as the cleaning and upkeep of communal areas, both inside and out.
Importantly, the collective freeholders also now have the power to grant themselves long lease extensions at a nominal price, and abolish ground rents, all without having to go through the normal statutory lease extension process or be bound by its fixed 90-year extension term.
Last but by no means least, there’s a psychological benefit to being a part-owner of a freehold building. Certainly, when it comes to marketing a leasehold property for sale, ‘share of freehold’ can be an attractive selling point.
What to do next?
In order to press ahead with the collective purchase of the freehold, you need to first ensure that all the criteria for eligibility are met. The next step is a professional valuation and taking specialist legal advice. Since most freeholders are unlikely to be cooperative in relinquishing their freeholds, the process of collective enfranchisement can be both lengthy and complex.
At South East Leasehold, we routinely provide professional advice and guidance in all matters of collective enfranchisement. Contact our legal and valuation team to advise if enfranchisement is an option and to manage the entire process on your behalf, for your best chance of success.