Leasehold Enfranchisement Solicitors

Collective enfranchisement gives tenants of flats the right to act together to purchase the freehold of the building.

The main reasons for long leasehold flat owners to consider buying the freehold are :-

  • To extend leases to 999 years at very low or no cost
  • Where the leaseholders believe the freeholder is managing the block badly or that any manging agents appointed by the freeholder are doing a bad job and/or are over charging.

Rather than buy the freehold, another option is to use legislation enabling leaseholders to take control using what is known as the Right to Manage process.

Buying the freehold – qualifying criteria

In order for tenants to qualify for this right, they must hold long leases (leases originally granted for a term of over 21 years).

The building must also qualify before the right can be exercised. In order for the building to qualify, it must contain 2 or more flats and have at least 2/3rds of the flats held by qualifying tenants. The other vital qualification is that at least 50% of qualifying leaseholders opt to buy the freehold. In practice this can be the most difficult obstacle especially with large blocks of flats.

Consequently, in many cases, flat owners end up proceeding alone with the alternative process of extending their lease. We can help if you decide this is the better or only available option.

It is important to check the criteria to ensure that the building and tenants qualify as there are a number of exclusions.

Process for Collective Enfranchisement

If you can satisfy the qualifying criteria, you will first need to establish what it is going to cost by obtaining a valuation. You should take the advice of a qualified expert surveyor. All of the participating tenants will then need to establish how to finance the cost of the acquisition.

An important issue to consider is the way in which the participating tenants will work together in order to acquire the freehold and also once they become responsible for the management and administration of the building in accordance with the obligations in the original leases.

It is important to consider all of the above issues before serving any notice on the freeholder to acquire the freehold.

The formal procedure for collective enfranchisement is :-

  1. Start by the service of an initial notice on the freeholder. The timescale thereafter must be strictly adhered to. The initial notice must be served on behalf of all the participating tenants. Normally, a company is formed by the participants to be the nominee purchaser.
  2. The freeholder has a period of 21 days from giving the initial notice, to request information. The freeholder must serve a counter notice within the prescribed date specified in the tenants’ initial notice.
  3. After service of the freeholder’s counter notice, if the parties cannot agree on the price or some other aspects of the acquisition, then after the initial 2 months following service of the counter notice, either party may apply to the First-tier Tribunal for a determination on the issues in dispute.
  4. In practice, most collective leasehold enfranchisements are resolved by negotiation between the leaseholders and the freeholder.

The participating tenants are liable for the freeholder’s reasonable professional fees from the moment they serve the initial notice, whether or not they complete the process.

Solicitors for leasehold enfranchisement

We are highly experienced in all aspects of leasehold enfranchisement and adept at the negotiation aspects of enfranchising as well as the formal legal process. If you need cost effective leasehold enfranchisement lawyers in London, please do get in contact.

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