Anyone who has owned a leasehold house for at least two years has a right to buy the freehold of the property.
The legal right to do this is set out in the Leasehold Reform Act 1967. In order to qualify, the property must be classified as a ‘house’. This might seem like a simple statement, but there has been a lot of case law on what constitutes a ‘house’ under the 1967 Act – some of which we have been involved in.
Essentially, the lease that you have must have been granted for more than 21 years originally, and be a lease of the whole of the property. In other words, if the lease is of the ‘inside’ of the house only, then the chances are that you will not qualify for these rights, although you may still be able to claim a lease extension.
In order to work out the premium payable for the freehold of the house, a valuer will look at the rateable value of the property on a number of dates and/or carry out a specific calculation if the property was built after 1990. The detail of this is best looked at by a specialist but essentially, this (along with your lease length) will determine how much you will pay. If your lease has under 80 years remaining, then you will pay significantly more, because of an additional factor known as ‘marriage value’ which comes into the calculation.
There are a number of other key points to consider, including alterations and additions to the property, and whether there has been a previous lease. This is an area where advice from a specialist is required.
If you have not already had valuation advice, we can recommend suitable surveyors familiar with the 1967 Act who can assist with this.
If you would like to know more about the first steps, and full process of buying the freehold of your leasehold house please email us firstname.lastname@example.org
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Mark Chick, head of the Landlord and Tenant team at Bishop & Sewell was interviewed yesterday by ITN regarding the breaking news item about Leasehold Houses and ground rents. “There’s an imbalance in terms of the rights that are available to leaseholders, and also the quality of advice which people are receiving.” Watch a clip of the… Read more »
Mark Chick recently recorded a podcast with LEASE the Leasehold Advisory Service about how to buy the freehold of a long leasehold house under the Leasehold Reform Act 1967. Links to this item appear below: http://www.lease-advice.org/publications/documents/document.asp?item=208 https://youtu.be/oIhKLW-ayx8 If you own your house under a long lease and have been the registered owner for at least… Read more »