Birmingham has a population of over 1.1 million people [according to 2018 figures from Birmingham City Council itself]. So, as Britain’s second city, you probably won’t be surprised to hear that there are a huge number of flats in Birmingham, many of which are owned under a long leasehold [i.e. a lease originally granted for at least 21 years] rather than rented from say the local authority or a housing association. In fact according to the 2011 Census, Birmingham had 86,595 purpose built flats – and that’s before you consider consider the tens of thousands of houses that have been converted into flats and the thousands of new builds.
But owning a leasehold flat isn’t like owning a freehold house. You don’t have complete control over your block.. Instead, you have to pay service charges and ground rent to your freeholder – and year by year your lease gets gradually shorter. So when it expires, you end up owning precisely nothing.
Do You Own an Apartment in Birmingham? Are You Interested in Buying The Freehold Of Your Block? For Expert FREE Initial Phone Advice, Call Us On FREEPHONE 0800 1404544
THE ANSWER? FREEHOLD PURCHASE
One way of avoiding these problems with a leasehold property is to join together with some of the other flat owners to buy the freehold of your block – through a process known as leasehold enfranchisement (often referred to as ‘freehold purchase’ or ‘collective enfranchisement’).
If you live in Birmingham and are thinking of buying your freehold, you’re going to need a specialist solicitor – the specialist enfranchisement team here at Bonallack & Bishop can help.
LEASE ENFRANCHISEMENT – WHAT ARE THE BENEFITS?
• Your flat will increase in value – and will become easier to sell
• You take over management of your block
• Block maintenance will probably become cheaper, as you organise it yourself
• You don’t have to put up with a difficult landlord
• You can extend your lease up to 999 years
• No more ground rent to pay
• Greater security – as a freeholder, normally only failure to meet your mortgage could cause eviction
WHY A SPECIALIST ENFRANCHISEMENT SOLICITOR IS SO IMPORTANT
You may wonder why any solicitor couldn’t handle your lease enfranchisement. After all, how difficult can it be?
Lease enfranchisement is, in fact, a particularly complicated area of law with tight rules, strict deadlines and a number of traps for the unwary. It is an area of law that very few property solicitors will ever have dealt with – and therefore are unlikely to have sufficient understanding of the issues surrounding enfranchisement.
Given that your freeholder is highly likely to instruct a specialist lease enfranchisement solicitor of their own, you do not want to start on an uneven footing – especially when large financial sums are at stake.
OUR COLLECTIVE ENFRANCHISEMENT EXPERTS
Finding an expert lease enfranchisement solicitor is difficult – the vast majority of property solicitors deal with regular conveyancing of flats and houses, with landlord and tenant issues or deal with commercial property. But not freehold purchase.
• We have a team of five who specialise in nothing but lease extension, right to manage company formation and lease enfranchisement.
• We are the only solicitors are recommended for freehold purchase by the Homeowners Alliance, the largest organisation representing Britain’s homeowners.
• Our team liaise with specialist enfranchisement and lease extension surveyors every single day – so, if you wish, as part of our one-stop shop service, we cannot only introduce you to a specialist local surveyor, we can also instruct them on your behalf.
• We are members of the Association of Leasehold Enfranchisement Practitioners (ALEP) – the only group of specialist enfranchisement surveyors and solicitors nationwide.
• We can handle your enfranchisement from beginning to end – from obtaining the initial valuation, and serving the Enfranchisement Notice, to helping you with formation of your freehold purchase company and registering you as a new owners with HM Land Registry – and even taking your case to the First Tier Property Tribunal in the unlikely event it becomes necessary
• Our dedicated team have helped thousands of clients with successful freehold purchase and lease extension cases over the last 25 years
THE IMPORTANCE OF BUYING YOUR FREEHOLD WITH AT LEAST 80 YEARS LEFT ON THE LEASE
Leaseholders seeking the right to buying the freehold of their block should be aware that it is more expensive once a lease has less than 80 years to run (the same applies if you’re thinking of extending your lease). Sometimes much more expensive.
Why? That’s because where the lease has less than 80 years left on it, your freeholder has the right to charge an additional premium – which is known as the “marriage value”. (The marriage value is valued at half the difference between the property value before and after the leaseholders have exercised their freehold right to bu)y.
In practical terms for most flats, this means each individual leaseholder may have to pay thousands more to participate in the freehold purchase. And that figure only increases as the lease term steadily drops.
Marriage value also applies to lease extension – so if you’re considering the alternative of extending your lease – try to do so before that critical 80 year period.
N.B. There is no marriage value if the unexpired portion of the lease has more than 80 years to run
GETTING OTHER LEASEHOLDERS INVOLVED IN BUYING THE FREEHOLD
If your leasehold enfranchisement is going to be successful, you are going to need the support of at least 50% of leaseholders of the block of flats.
And getting half of all the leaseholders to commit, and remain committed, can be a tricky job with medium and larger sized blocks.
However, the good news is that the freehold purchase process can be started with less than 50% of leaseholders, provided the 50% quota is eventually reached. This is an important point to bear in mind. Often leaseholders will be reluctant to get involved with the collective enfranchisement until they are sure it will go through. This “chicken and egg” situation needs tackling at the early stages of freehold purchase.
One of the best ways of getting people committed to the project is by getting them signed up to what is known as “a participation agreement” – a legally binding contract setting out the details of the planned enfranchisement and who will be involved.
Our specialist team can help you draft a participation agreement that suits your particular circumstances.
Click here to read more about participation agreements.
THINKING OF ENFRANCHISEMENT IN BIRMINGHAM? CONTACT US TODAY
Due to the specialist nature of our service, we represent leaseholders and freeholders alike throughout England and Wales – with the vast majority of our enfranchisement cases being run by phone, email or video call.
For FREE no strings attached initial advice and a FREE enfranchisement quote
• Call our team free on FREEPHONE 0800 1404544 or
• Fill in the email enquiry form below