Selling Flat With Share of Freehold

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If you are the owner of a leasehold flat that also has a share of the freehold of the building in which your unit is located, this is a more uncommon type of property but there are no legal reasons you can’t sell this type of home. Below you’ll see tips on how to speed up the sale of such a property, as well as a guide to attracting the most competitive offer possible.

1. What type of property is a flat that has a share of a freehold?
2. Reasons why buyers could want to own a flat with a share of freehold
3. Concerns buyers may have about your flat that has a share of freehold
4. Selling a flat with a share of freehold that has a short lease left
5. Four methods to sell your flat with a share of freehold
6. Answers to top questions about selling a flat with a share of freehold

What type of property is a flat that has a share of a freehold?

Properties in the UK are either leasehold or freehold – leasehold homes are those where you own the property for a set number of years, as specified in a lease agreement that you sign with the freeholder, and you pay them an annual ground rent whilst living there. Freehold homes, by contrast, are ones where you are the outright owner of the building and its land.
An uncommon situation is where you own a leasehold flat that has a share of the freehold of the building in which the unit is contained. This means that you and the other leaseholders of flats in the property all have a legal right to part of the freehold as well as having your lease.
Freeholders have more control over how a building is managed and maintained, covering key issues like the service charges and ground rent that leaseholders must pay, how costs will be covered for work needed for the upkeep and future of the property, and more.
As you’ll see in the following sections of this guide, there are various pros and cons that potential buyers could see your flat as having because of the share of the freehold, and some of these might result in delays to the selling process or may create certain complications – such as buyers being worried about the burdens associated with duties for looking after the building.
But you’ll also be able to learn about ways that you can increase your prospects of getting a buyer to make a fast and fair offer to purchase your flat, like getting in touch with LDN Properties or another quick buyer who can purchase your property fast with zero fees.

Reasons why buyers could want to own a flat with a share of freehold

You will find that there are a number of possible advantages that buyers could associated with your leasehold flat because it has a share of the building’s freehold. Knowing these factors can be useful in promoting them to people who show an initial interest in owning your flat.
Reduced charges: Many people who own a leasehold flat that has a share of the freehold are able to have a significant role in deciding the service charges, ground rent and other fees that they and the other leaseholders will pay. This can often result in these costs being lower than the same charges for a leasehold flat that does not have a share of the freehold, and this can be attractive to those buyers who are looking to keep costs low at their next property.
More control: One of the most appealing aspects of a flat like yours is that the share of freehold gives you more say in the upkeep and future of the overall building, including policies and maintenance, as the Net Lawman website notes. This could be a major plus for buyers who are interested in your flat but also want to be able to exert some control over how the larger property is operated.
Cheaper extensions: This is explained in more detail in a later section of this guide, but getting an extension on your flat’s lease can typically be cheaper when you have a share of the freehold. If you are in a situation where you have a short lease remaining but don’t want to go through the process of extending it, potential buyers may see the reduced cost of seeking an extension as helping overcoming concerns with purchasing a flat with a short lease.

Concerns buyers may have about your flat that has a share of freehold

If you’re trying to sell a flat with a share of the freehold, you could also find that there are some challenges with getting buyers interested because they may have some worries about owning such a home.
Transfer problems: If all the flat leaseholders in the building have an equal share of the freehold, you might face some additional hurdles if you need to have each of the owners sign the transfer of your share of the freehold to whoever buys your flat – for example if one of the leaseholders will not be available for an extended amount of time. This could potentially be a long and complicated process that might discourage some potential buyers.
Property conflicts: Whoever buys your flat will have a role to play in setting the building’s policies, resolving any urgent maintenance needs and more, and these situations can sometimes create conflict among the various flat owners that have a share of the freehold, as Haart’s website explains. This possible future stress may be more than a buyer is willing to accept.
Legal obligations: Your share of the freehold may also come with a legal duty for you to perform certain tasks in the interests of the overall building, such as filing property management accounts, and a homeowner can be subject to potentially expensive fines if they fail to comply with these requirements. This type of burden could be something that is a deal-breaker for someone that would be otherwise be interested in making an offer on your flat.

Selling a flat with a share of freehold that has a short lease left

Another potential complication that could arise with selling your flat that has a share of the freehold is if you have a short amount of time left on your existing leasehold agreement.
Generally, leases are considered short if they have less than 80 years remaining because it raises questions for a buyer about their potential future legal ownership of the property. The smaller the amount of time left on the lease, the more this can reduce the sale value of your flat, so one solution you might be considering is trying to extend the lease before selling.
Just beware that this could be a complicated and lengthy process, so it’s not necessarily a good move for those homeowners who are trying to sell their flat as fast as possible.
But a great advantage of having a share of the freehold is that you might not have to pay for extending your lease compared to conventional leasehold flats where the owner is responsible for the often high costs of securing an extension, as Kenneth Elliott & Rowe Solicitors note. For example, they say it could cost at least £15,000 to extend a lease that currently has about 70 years remaining on it.
If you want to sell without first getting a lease extension then it’s perfectly fine to do so, and you can still get a quick and competitive offer for your flat by getting in touch with a quick home buying company. These businesses, like LDN Properties, are known for making speedy and fair offers to purchase all types of homes, including flats with short leases and a share of the freehold, so it can be a stress-free and streamlined way to sell your property.

Four methods to sell your flat with a share of freehold

When you are prepared to take the step of selling your flat that has a share of the building’s freehold, your usual choices for selling will be through an auction, with an estate agent, without any assistance or to a quick home buyer. The details of each method are below, and you’ll see that there are specific advantages and disadvantages associated with each of them.
For example, you will not need to pay any commission if you opt for selling your property to a no-fee quick buyer like LDN Properties. But if you choose to sell through an estate agent, you will be required to pay them commission and the sale might also take many months.
A helpful task can be to write your main aims with the sale of your home, including whether you can accept paying any fees, how long you can wait to find a buyer, and your goal selling price. Then compare all of this information against the specifics of the four approaches below, because this should help you with finding the choice that best pairs with your situation.

Selling through an auction

With an auction, you choose a reserve price – the lowest value at which you are willing to sell your property – and then people can place bids at ever-increasing prices. The aim is to have several people wanting to buy your home so that the final auction sale price is very high.
But if you get no bids on the flat then it will go unsold and you will have to restart the process of seeking a buyer, extending your selling timeline even longer. And you may get just a single bid at the reserve price, which is a binding legal agreement to sell the property that the bidder could sue to enforce if you try to terminate the sale. That’s why you need to set a reserve price that will produce a profit for you, even after you have subtracted the auctioneer’s fees.
Auctioneers usually charge commission at 2.5 percent of a property’s sale price, as the HomeOwners Alliance says. This fee is deducted immediately from the final auction proceeds and therefore will increase your net expenses with selling.
Beware that some auctioneers could charge even higher than 2.5 percent, which will raise your selling costs further. But other auctioneers may be open to reducing their fees or having the buyer pay some of your expenses, so it can be useful to ask about these options.
Auctioneers charge commission for the work that they do with selling a property, which includes hosting the auction. Ahead of that event, they will prepare and advertise a listing that features photographs and a description of your flat, using this to make buyers aware of the sale.
You could find that many auctioneers are not used to selling flats with a share of the freehold, as they are less common than conventional leasehold flats. If that’s the case, they may struggle with attracting buyers to your home, so always ask auctioneers about their track record with selling homes like yours and opt against using the services of someone with no experience.
Regardless of whether an auctioneer has such experience, this is not a swift way to sell a property. There will be weeks or months of waiting between the day when you decide to sell this way and the day that the auction happens. And if your home sells, the buyer then has about 28 days to sign the required legal papers and complete the other tasks to finalise the sale.
Some auctioneers could be willing to set a shorter deadline for the buyer to finish these steps, so you can ask if that’s possible, but others may allow them even more than 28 days.

Selling with an estate agent

Estate agents will do many of the important tasks involved with selling your flat, including the creation and advertising of a listing, along with scheduling viewings to take prospective buyers on tours of your property, and hearing offers – hopefully taking one to exchange of contracts. This can reduce your stress significantly by helping you avoid most of the work with selling.
But you will have to pay commission to the estate agent if they manage to sell your home, and this is charged as a percentage of the final property sale price. Expect the rate to be within a range of 1.15 percent to 1.40 percent of your home’s selling price, but it may be higher or lower. This will add to your expenses and will be deducted right away from the eventual sale proceeds.
Flats with a share of the freehold are also not as common as typical leasehold flats, and some estate agents may never have sold such a home before. This suggests that they could find it hard to know how to get buyers interested in your property, so it’s a good idea to ask estate agents if they’ve sold a home like yours before and avoid selling with those that haven’t.
With or without such experience, this could still be quite a slow way to sell your flat, and you should be aware that it might take more than a year before you get a serious offer. And a buyer can make an offer but then cancel it, causing the sale to fall apart. They can do this without having to face any penalties if you are yet to exchange contracts, and it will require you to begin again with seeking a buyer, possibly adding many more weeks or months to the timeline.

Selling without any assistance

If you want to avoid paying fees when selling, you could do so by looking for a buyer without any help from an estate agent or auctioneer. This will reduce your overall costs with selling because you won’t have to pay a third party any commission if they manage to find a buyer.
But this can be a very stressful way to sell your flat because it will be your responsibility to take care of all the steps needed to sell. This includes preparing a listing, advertising it, organising viewings for interested buyers and hearing offers, hopefully taking one to exchange of contracts.
It is a lot of work and therefore is only suggested if you have previously manage to sell a flat with a share of the freehold, or you have a qualified friend or family member that is willing to help you with the sale for free. If not, it could be a long and difficult process to sell your property.
Because these properties can be harder to sell, that also increases the prospects of you waiting even longer to find a buyer if selling on your own. You should be prepared to wait at least a year before you’re able to sell. Note that someone could make an offer but rescind it and make the sale collapse, which will add even more time as you’ll need to start again with finding a buyer. They can do this without penalty so long as you have not yet exchanged contracts.
As an alternative, you may want to sell your home to LDN Properties or another no-fee quick buyer, because not only will you get to avoid paying commission, but you will also secure a much speedier sale. These companies can usually complete the process of buying almost any home within a few short weeks, making them a stress-free and rapid way to sell your flat.

Selling to a quick home buyer

Quick buyers, like LDN Properties, have the funds available upfront to buy your flat straight away, with no waiting for many weeks or longer to initially get approved for a mortgage to cover the cost of the purchase. This cuts the schedule for selling this way down to a handful of weeks, and the covers the final steps of exchanging contracts and paying you the sale proceeds.
These companies are also experts at buying less-common properties, such as flats with a share of the freehold, and they will make competitive and fast offers to buy homes no matter their age, condition, shape, size, type or if they have some significant flaw, for example subsidence.
Some of the other varied purchases and offers that LDN Properties has made since it launched more than 15 years ago include million pound properties, homes with high level of asbestos, penthouse flats, mundic houses, properties where the owner cannot locate the title deeds or other important documents, flats in buildings without a lift, homes situated near to a motorway, listed properties, houses that have septic tanks, flats situated close to power lines, guest houses, and many other scenarios.

Top queries and answers about selling a flat with share of freehold

Flat owners thinking of selling their home quickly can have some key questions to be answered, ranging from the steps needed before selling through to selling a flat without a management company. Here are some of the questions we’ve answered about selling a flat with share of freehold: