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Joshua
Joshua, Lawyer
Category: Property Law
Satisfied Customers: 27274
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Can you buy a flat from the Council on Freehold instead of

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Can you buy a flat from the Council on Freehold instead of Leasehold?
JA: What steps have you taken so far? Have you prepared or filed any paperwork?
Customer: None, I am just asking, needs to know, as I am not interested in Leasehold, don't see anything good in it, as your children will still have to re-buy agter 120 years at the prevailing market price, so the property is never yours.
JA: Where is the flat located?
Customer: Eltham, belong to the Council.
JA: Anything else you want the Lawyer to know before I connect you?
Customer: No.

Hello and thank you for your question. I will be very pleased to assist you. I'm a practising lawyer in England with over 15 years experience.

 

Mya I confirm this is a flat (i.e. typically divided horizontally from other properties), as opposed to a house (i.e. typically divided vertically)?

Customer: replied 8 days ago.
I do not understand what you mean by divided horizontally and vertically, but this is a flat and there are houses of the same shape and sizes all mixed together in the area and buildings. Sometimes, it is difficult for you to establish if one is a flat or classified as a house by the council, because some flat do have sole front garden and sole back garden, massive, but the fact that there is another apartment above you, so they say it is a flat, even though they both have different gardens. Those regarded as houses in this area do not have another apartment above them, although all properties and buildings are all joined together, flat or house, so I am thinking in that case, can you buy these so classified as flat on a freehold basis?
Customer: replied 8 days ago.
Are you still there Joshua?

Thank you. my apologies if the above was unclear. another way of putting it is that flats are typically built one on top of the other where as houses are typically built one next door to the other.

 

if this is indeed a flat as you say - i.e. there is another flat above or below it, then it is unfortunately not possible, nor indeed is it desirable for reasons I will outline a moment, to buy a freehold flat. The reason for this is that freehold titles make little room for regulating obligations and rights as between different owners - for example what if your flat is built ontop of someone elses and he doesn't maintain his flat so it starts to crack. your flat is built on top and so therefore relies upon the flat below for support but if both are freehold, you cant force the flat below to maintain his property if it is freehold and your flat may eventually fall down but there would be nothing you could do. This is one example of many.

 

This is why mortgage lenders will not lend on freehold flats and they are not desirable to buy.

 

leasehold titles were designed specifically to address situations such as the above in that they allow relations between different leasehold flat owners to be regulated so that you can rely on support of the main structure and so on.

 

There was a proposal some 15-20 years ago to create a new kind of ownership called Commonhold ownership which was designed to address at least some of the kinds of reservations you point out and create a sort of hybrid freehold ownership but it never really caught on for various reasons and only a tiny handful of properties adopt this type of structure.

 

So in summary, regrettably it is not possible to buy the freehold and you would not want to because you would not be able to get a mortgage or would you be able to sell it. What you can do is look to buy the freehold of the building if 50% or more of other flats in the building are privately owned and 50% or more of those private owners wish to join with you in the purchase. This would mean you are still a leaseholder but you own a share of the freehold which means that you can extend your lease without payment and have a say in how the building is maintained and so on.

 

Does the above answer all your questions? If it does, I should be very grateful if you would kindly take a moment to rate my service by selecting the 5 stars at the top of the screen before you leave JA today. Your feedback is important to me. If there is anything else I can help with please reply back to me though

Customer: replied 8 days ago.
I ma not finished yet, didn't know you are back.

is it something else I can help you with?

Customer: replied 8 days ago.
yes, one second pls.
Customer: replied 8 days ago.
Righto, I got you now. Okay, if I am going to buy this on leasehold, how much help do I het on a right to buy, I have been with the council for 11 years. Do I get over 50% or how is that worked out? Thanks.
Customer: replied 8 days ago.
Are you there Josh?

I can provide you with an estimated figure but an accurate valuation of the property will be needed to confirm the exact figure so please do not rely on this for anything more than a good guide. Could you confirm your postcode and the approximate value of the property if it were yours to sell privately?

Customer: replied 8 days ago.
Thanks, the postcode is SE9 5RS, and the selling price according to Zoopla is between £241 to £295. Regards.
Customer: replied 7 days ago.
So approximately, how much do you think the Greenwich Council will be asking me to pay, with my records of 11 years as a responsible tenant without any areas.

Thanks - so on these figures and facts you should in theory qualify for the maximum discount which is £110,500. The council would value the property and you would be asked to pay the difference between the valuation figure after the discount is applied as well as costs of the purchase - e.g. legal costs, stamp duty etc. Stamp duty is assessed on the discounted price you pay rather than the valuation price

 

Has the above answered your questions satisfactorily?

Customer: replied 7 days ago.
Absolutely brilliant, that is like £110 from £260, which may come down to me paying about £150K. I though the stamp duty will be nil according to the former Chancellor's directives, because the property value is less than £500K, more so it will be my first property. What do you think?

Obviously the valuation figure for the property we don't yet know but you have a guide from Zoopla/Rightmove etc as you say. And yes if the valuation figure turned out to be £260,000 then you should qualify for £110,500 (note this discount may increase slightly in April in line with inflation) which would make the purchase price £149,500. If this would be your first home then you would in deed benefit from the £500K SDLT allowance so no SDLT (stamp duty) would be payable.

Does the above answer all your questions or is there anything I can clarify or help you with any further?

Customer: replied 7 days ago.
Not for now, you've been brilliant sir, much appreciated. I did Law up to LPC, but Housing Law and Practice was one of my most weakest link, but you have explained this to me as if I were a layman, wonderful. I will remember to leave 100% positive feedback for you, because that is what you deserved sir.
Kind regards.

Many thanks. I'm glad it was of assistance. I hope your purchase goes smoothly.

Customer: replied 7 days ago.
By the way, is there a link or provision to forward this corresspondence to my private email for my perusal?

You can return to this thread at any time if you want to read through again. There should be a direct link in any of the emails you have received from the site or yuo can access it from your account on this site.

Customer: replied 7 days ago.
wonderful, thanks, bye.

All the best

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