Taking on the freehold of your block of flats often requires expert help, says Jane Barry.
Want to buy your freehold but not sure how to go about it? There are companies that will project-manage the whole process for you from start to finish. And the time, money and aggravation they save can make it well worth paying their fees.
In some ways, it has never been easier to enfranchise – the technical term for buying the freehold of, say a block of flats. Changes in the law mean anyone wanting to do this need only win the agreement of half the block’s leaseholders. A previous obstacle, which effectively disbarred owners who were non-resident from the vote, has been removed.
If your lease has 85 to 81 years to run, it is time to act – once it drops to 80 years, you may have to pay compensation to the landlord, at rates that quickly soar. If the lease is even shorter – say 60 years to run in central London or 70 years in the suburbs – you should act soon because if you want to sell you may find mortgage lenders getting sniffy with your buyer.
The trouble is that buying the freehold involves a lot of paperwork, and so, unless there are a couple of dedicated residents willing to do the legwork of setting up a company, finding a valuer and a solicitor and tracking down absentee owners, you will probably need the help of a specialist enfranchisement company.
When the leaseholders of Toby Horton’s 26-flat block in Kensington’s Onslow Square decided to buy their freehold from the Wellcome Trust, they called in Alex Greenslade of Leasehold Solutions. Greenslade, who has pioneered the service, managed the entire project, including helping the block set up a residents’ freehold company, contacting absentees and negotiating with Wellcome. All the 16 participating leaseholders had to do was agree the package, sign the contract for the £1 million-plus purchase and write the necessary cheques.
“These transactions are always much more complex than you think they’ll be,” says Horton, who chairs the freehold company. “We couldn’t have done it without Alex. He took us through it stage by stage. The key is getting your leaseholders together, and he did some very good detective work. Once he’d got all the leads, he put the whole thing together and we completed on 16 September, on schedule.”
Leasehold Solutions acts for blocks of 12 or more flats, with a 75% success rate at getting leaseholders to participate. Stage-by-stage fees are tailored to the project. “They usually amount to a few hundred pounds,” says Greenslade, an ex-market researcher. “We save money in getting more participation as every extra person brings the price down. We also reduce legal and surveyors’ costs, getting them to quote fixed prices.”
Although Horton’s block was happy to stay with its managing agent, Cluttons, Greenslade will help blocks choose a new agent if necessary. His biggest obstacle, he says, is leaseholder apathy. “I ask at the first meeting, are there at least two of you prepared to become directors because, if you aren’t, just get lease extensions.”
Peter Haler of LEASE, which gives free advice to leaseholders, thinks the service offered by Leasehold Solutions and similar companies makes sense. “Usually, we don’t recommend anybody but we strongly support this. They save costs by making sure the professional advice is organised to do exactly the right thing.”