Freehold Maisonette – why is this a bad thing?

Freehold Maisonette – why is this a bad thing?

18:27 PM, 10th August 2013, About 10 years ago 17

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We have just put our freehold maisonette up for sale. It is ex local authority and ground floor, the property above is still local authority, although I believe the adjoining two are private. Buyers will not be able to get a mortgage, because it is freehold. This has never been a problem to us (cash buyers), any more than adjoining any other private property. The council has been kind enough to replace the roof (flat) without contacting us. When I contacted them to discuss the broken gate, this was replace directly. Freehold Maisonette - why is this a bad thing

So why is there this problem about the place being Freehold? Is there any way around it? How could it become leasehold? At the moment we have told the estate agent to market as cash only, but they have stressed that so much it sounds as if the place is falling down.

Any advice would be appreciated.

Celia Burns

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Mark Alexander - Founder of Property118

18:31 PM, 10th August 2013, About 10 years ago

Hi Celia

It just doesn't make sense to me that you could own a freehold maisonette which was previously Council owned. What makes you think it's freehold and how did this come about?

Have you discussed this issue with the solicitor who acted for you at the time of purchase? If they didn't advise you properly at the point of purchase you may well be in a position to make a claim against them.

Are you absolutely sure it's freehold?

I'm not sure what can be done if the maisonette is a freehold, where is it located as a matter of interest? Depending on whether it is in England, Wales or Scotland I may be able to refer you to a specialist solicitor.

Celia Burns

10:57 AM, 11th August 2013, About 10 years ago

Reply to the comment left by "Mark Alexander" at "10/08/2013 - 18:31":

Thank you for your prompt response, Mark.

I have looked again through the Land Registry documents and there is a Leasehold and a separate Freehold Title, both having been transferred to us on purchase. Does that make it Leasehold (for a mortgage) and Freehold at the same time?

How should it be marketed?

Many thanks.

Celia Burns

Mark Alexander - Founder of Property118

11:59 AM, 11th August 2013, About 10 years ago

That's the question you need to be asking your solicitor Celia, preferably the one which acted for you when you purchased. Make sure you get the a answer in writing so that you have evidence.


14:40 PM, 11th August 2013, About 10 years ago

You may hold either a share of the freehold or the entire freehold on the land on which the building stands if the other leaseholders declined their right to buy, so get the original full lease and freehold papers & read the details carefully to establish whether you own the land outright or/and who holds the other "shares".

There should be absolutely no problem selling the maisonette with a lease as holding the freehold you can raise a fresh one to satisfy any mortgage company. Of course there will be some costs in doing so.

You just have a crummy estate agent in my opinion as a share of freehold can be a huge bonus.

PS If you do hold the full freehold and the other maisonette has a very short lease you may want to re-consider whether you want to sell that freehold or you could be giving up a lot of potential as the other leaseholders will need to extend at some stage, so seek proper advice - not on an informal blog like this.............

Joe Bloggs

9:28 AM, 13th August 2013, About 10 years ago

the need for a lease is because of the need for covenants and easements etc. for rights of way and repairs, service charge and suchlike. very odd the LA also sold the freehold reversion as i dont think they would have to under the RTB (just 125 yr lease). these provisions are not contained within a freehold title. however, if you have a separate leasehold and freehold title then i wouldnt have thought there is a problem; you can sell them separately.


17:11 PM, 13th August 2013, About 10 years ago

I own one flat in a block of 4, my kids also own one both rented. The other 2 are owner occupied between us we all own 25% 0f the freehold and 25% of the lease hold,

As a result we all pay a small maintenance and ground rent to ourselves to maintain the property. A total of £300pa and our fund is growing. Compare that to other flat having to pay £1000 or more pa for service charges etc.

Can't see a problem with resale on these grounds.

My nephew has recently had to extend his lease and it cost about £7k per flat. Best to own a share of both.

Lauren Wadey MIRPM, AssocRICS, CIHM

15:26 PM, 14th August 2013, About 10 years ago

The only problem is the Estate Agent who are most likely unfamiliar with this tenure set up. Certain mortgage companies might steer clear of this property but there is enough lenders out there for it not to be any more of an issue than a traditional freehold house.
Seek out a more experienced agent who will be in a better position to attract and secure appropriate interest is the crux of the matter here.

As an aside, the share of freehold/freehold set does need to clarified and fully explained to you and any perspective purchasers. Both present challenges but neither are un-workable with the right guidance.

Always happy to advise you further on this if you have any specific concerns so check out my member profile.


16:51 PM, 14th August 2013, About 10 years ago

Used to be the case that a flying freehold was difficult to mortgage and usually an upper floor or overlapping part of a building. e.g. a flat sold without a proper lease. The feeling was that if the building collapsed you owned nothing.

These seem to have been largely superseded by shared freeholds so you should be fine.

Nick Pope

8:52 AM, 18th August 2013, About 10 years ago

As an ex estate agent and current surveyor and small time landlord I have come across this situation many times. The situation probably arose because the local council could not be bothered to deal with the day-to day running of a small block and sold the freehold interest to whichever of the leaseholders was interested at the time. It was quite common also that for maintenance purposes the ground floor occupier(s) was responsible for the foundations and walls to first floor level and those on the first floor for the roof (a much more onerous and expensive part of the building. You are very lucky that the council has done all this for you. It leads me to think that perhaps the upper floor is still occupied by council tenants and that they have to deal with any roof problems. On this point do you pay a maintenance charge of any sort to the concil?
So far as the 2 interests are concerned they are completely separate and as freeholder you could complain to yourself if you do not comply with any terms of the lease.
For selling purposes you may wish to take advice as to whether you (as freeholder) should grant yourself a long lease of, say, 999 years to make the leasehold interest more saleable and at the same time keep the freehold and charge for a lease extension for the other occupiers if they require it in the future. If the leases are shorter than about 70 years this can be quite profitable (See Recardo Knights' comments above).
On the down side you may have management responsibilities which would take time so a separate sale of the freehold might be advantageous.
In conclusion, take advice from your solicitor and then consult someone who understands these matters - estate agents might not be your best avenue as most of them wouldn't understand the concepts involved, let alone the differing values. Perhaps a chartered surveyor would suit your needs for such advice.

andrew townshend

10:03 AM, 18th August 2013, About 10 years ago

Reply to the comment left by "Mark Alexander" at "10/08/2013 - 18:31":

certainly sounds odd, personally i only buy freehold i feel better owning, and therefore only answerable to my self.

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