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Collective Freehold Acquisition or Disposal

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Collective Freehold Acquisition or Disposal in Chesterfield, Sheffield, Dronfield and Mansfield

Talk to Banner Jones. We are ready to help you.

Why is it worth buying my freehold?

It is usually the case that all of the leases in a block of flats have the same term and therefore all need extending together.  Whilst an individual leaseholder will have the right to extend their lease, for various reasons it can be more efficient and cost-effective to collectively buy the freehold, and then grant yourselves lease extensions as a separate step once the freehold purchase completes.

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Can the freeholder refuse?

If your group can meet certain criteria, you can demand the freehold and the current freeholder cannot refuse to sell.  The key point to remember is that the qualifying criteria works on a “per building” basis.  If your development is made up of many buildings, you need to consider each building separately.  Based on the numbers participating, you may find some buildings qualify, and some don’t.  It is possible to acquire one building separately, which in effect “severs” the freehold.  The number of participators must be at least 50% of the flats in the building.  Where there are only two, both must participate.

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Can’t the freeholder just set the price so high that it isn’t worth buying?

No – if the price cannot be agreed, it will be determined independently by the First-tier Tribunal.  The calculation of the price can be complex.  It is based on a number of factors, such as the market value of the flats, the length of their lease terms remaining and the ground rents currently paid.

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Does this mean I won’t have to pay ground rent anymore?

The group of leaseholders who participated in the process can elect to stop charging themselves ground rent if they wish. They will be able to charge ground rent from all the leaseholders who did not not participate. They can grant themselves lease extensions and, depending on the structure of the leases, take over management responsibilities for the site.

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Isn’t it difficult to get a group of leaseholders to agree on such a process?

It can be. A number of different issues should be addressed:

  • Attending “group session” meetings where the process is explained, documents are signed and questions are answered.
  • Using a Participation Agreement to ensure participators remain committed to the process throughout.
  • Forming a limited company to acquire the freehold, which is usually appropriate in all cases except for the smallest freehold acquisitions.
  • Establishing “group liaisons” who channel information both ways between lawyers and participators.

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Why choose Banner Jones for Leasehold Conveyancing?

We have acted for groups of leaseholders buying their freehold, with buildings ranging from two maisonettes, to over fifty purpose built flats. We have also acted for landlords and intermediate landlords who have received statutory notices from groups of leaseholders. We have the experience and knowledge to run this kind of project from start to finish.

We've successfully dealt with all types of leasehold property transactions including:

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Everything went smoothly, no trouble at all. Thank you.

Mrs H, Mansfield

Talk to Banner Jones. We are ready to help you.

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Frequently Asked Collective Freehold Acquisition or Disposal Questions

An investor has pulled out causing our chain to collapse, what can we do?

The current market and national economy is so uncertain that people may choose to wait and indeed remove their risk by pulling out of the transaction.  Although there is no reason not to carry on as normal in terms of the legal process we have to consider slower transaction times or hesitant investors or buyers.

At what point in the process is it legally binding?

You can withdraw from a sale or purchase up until the point contracts have been exchanged. Any deposits paid after exchange of contract will then by non-refundable. After contracts are exchanged you are then responsible for the property you are buying and should arrange suitable insurance from this date.

How long are local searches valid for?

A local authority search completed for a house purchase is valid for 3 months.

How long does the conveyancing process take on average?

We usually say 8-12 weeks for an average sale or purchase. Queries and concerns can often come out of the local authority searches which need further investigation and sometimes this leads to re-approval from the Mortgage lender. This can add further time into the process.

What happens if the house I am buying has quarantined owners in it?

Unfortunately, in this situation the seller will not be able to give vacant possession, which will lead to completion delays.  As a preventative measure, as per question 1, we can offer to exchange contracts and complete on the same day, which ensures that contracts are only exchanged if all parties in the chain are able to move on that day, thus reducing the risk to all parties.  This can be more stressful so we ask that clients be sensible and accommodating of the situation.

What happens if we can’t produce certificates for work we’ve had done on the house we’re selling?

You can indemnify the work by taking out an insurance policy. This means that you can not be held liable for any future fault on the work that was done. We can arrange this for you

What is Stamp Duty and how much will I have to pay?

Stamp Duty is a tax levied by HM Government on a transfer of property. For residential single property ownership this tax is calculated at 5% for the portion of the property value between £250,001 and £925,000, 10% for the portion between £925,001 and £1,500,000 and 12% for the portion £1,500,001 and over. Duty may also be chargeable on any rental charge (leases only) - this affects both residential and commercial leases where different thresholds are applied. There are different rates for First time buyers and "second homes/buy to let".

See our stamp duty page for more details

What is the difference between Joint Tenants and Tenants in Common?

Tenants is Common is where two or more people are entitled to the proceeds of sale in distinct shares - on the death of one, his/her interest will not pass to the survivor(s) but will be part of his/her estate. Joint Tenants are on the other hand 50/50 Co-owners of land - when one of them dies, his/her rights of ownership pass to the survivor(s).

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Great service from start to finish. Josh kept us updated throughout the process and was always very prompt with responses. Highly recommended.

Mr & Mrs B, Mansfield

We opted to use Banner Jones for assistance with our property purchase. We found the team to be extremely professional and great with communication. All round impressed, would use again for other services. Thank You

Mr & Mrs S, Chesterfield

Cheryl gave an excellent service. Told us everything in detail. Good work, Cheryl.

Mr B & Ms R, Market Warsop

House moves are very stressful. First rate service. I was put at ease with everything and the way our move was handled. I would highly recomend Banner Jones.

Mr & Mrs B, Chesterfield

Hollie was really great! What a great team, thank you very much!

Mr & Mrs H, Mansfield

I received excellent service for the purchase of my house

Mrs S,Sheffield

Thanks very much Jenna. I have been very happy with Banner Jones's help in the sale of my home. Please pass on my thanks to Gemma. Best wishes.

Mr W, Derbyshire

Holly

Many thanks for all your help in making the sale /purchase of the above properties such a thoroughly smooth, stress free journey.

We can highly recommend your company .

Mr & Mrs C, Hockley

Hollie was excellent. They responded to all our enquires straight away and explained everything in great detail. Banner Jones offer a friendly and reliable service.

Mr & Mrs J, Isle of Wight

Thanks so much for all the hard work. Even though the chain wasn't without it's issues, we found you both to be swift in your responses and supportive to us as a family.

You'll be pleased to know we love our new home and have settled in brilliantly.

Mr & Mrs H, Chesterfield

Meet the Collective Freehold Acquisition or Disposal Team

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