Q: I am buying a flat that is being
marketed as having a 'share of freehold'. Please explain
what that phrase actually means, whether there is still a lease and
whether I need consent to alter the flat after I purchase
A: Buying a share of freehold means that you
will acquire a shared ownership of the freehold title relating to
the building, as well as a leasehold interest in the individual
Usually the freehold title is registered in the name of a
company in which the flat owners will be shareholders.
Alternatively, the freehold title can be registered in the joint
names of up to four individuals.
Owning a share of the freehold does not entitle you to simply
ignore the terms of the lease. Accordingly, if the lease prohibits
alterations without landlord's consent, breaching the terms of
the lease could have costly consequences.
A lease is a wasting asset that will become less valuable the
shorter it becomes. A key advantage of owning a share of the
freehold is that the co-freeholders can agree to grant themselves
999 year leases, thereby protecting the value of their investment.
Owning a share of the freehold also means that the lessees can have
greater control of the day-to-day management of the building.
Owning a share of freehold can have its drawbacks. For example,
the administration involved in the management of a building can be
time-consuming. Poor management can lead to a range of
You should note that acquiring a share of freehold is generally
a good thing but doing so does come with its own issues. A good
solicitor will help you to ensure that your share of freehold dream
purchase does not turn into poorly managed building nightmare.
This article was first published in the September 2016
edition of the leading lifestyle magazine,The
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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