Buying freehold

Alicefward

I'm a FTB hoping to exchange this week on a 2 bed flat with 949 year lease. We've heard that the freeholder has passed away, and that the freehold will now be sold as part of the estate.

I'm seeing my solicitor on Thursday for official advice but ineterested to find out in the meantime if anyone knows how this might effect us down the line? We are likely to complete before the freehold is for sale.

As far as I understand owning the freehold wouldn't be a big advantage when the lease is so long anyway and ground rent only £22 a year. But we would be offered the freehold first before open market sale.

There are 20 flats and a tenants management company. How does this work with so many parties involved?

Thank you.

eddddy

Normally, it's seen as a risk if a freehold is about to be sold on the open market - because you don't know what the new freeholder will be like.

So assuming your fellow leaseholders are rational, sensible people, you might prefer to jointly buy the freehold. (But if some of your fellow leaseholders are 'irrational fools' who will make silly decisions - you might prefer that they didn't buy it.)

But... you say...

Alicefward wrote: »

There are 20 flats and a tenants management company.

If that's a tenants' RTM (Right to Manage) Company, realistically nothing would change whoever bought the freehold. The RTM company would continue managing everything.

And FYI - over 50% of the leaseholders need to agree in order to buy the freehold. So in this case, 11.

Alicefward

Thanks eddddy, helpful to know they'd need 50%. I think it is a RTM Company but i will check this with our solicitor on Thursday.

westernpromise

If 11 agree and 9 don't, is there anything that stops the 11 buying the freehold and increasing the ground rent? - or the service charges?

eddddy

westernpromise wrote: »

If 11 agree and 9 don't, is there anything that stops the 11 buying the freehold and increasing the ground rent? - or the service charges?

The lease specifies the ground rent.

If the service charge is unreasonable, a leaseholder can take the freeholder to a tribunal.