What is leasehold enfranchisement?
Nobody said it was easy. Enfranchisement is an important right, so ensure you know and understand your position. The leaseholder of a flat or house you may have rights relating to your leasehold home, which can be exercised either individually in isolation or collectively with others. There is criteria but qualifying with this and position of the leasehold owner, this right can force their landlord to either grant a new lease or sell the freehold interest. There are various routes which might be followed but this can only be a brief insight into the opportunities.
Under the Leasehold Reform Act 1967 the leaseholder of a house (defined under section 2(1) of this act) providing they are a qualifying tenant can pursue a new lease for an additional 50 years or may be able to purchase the freehold of the property. Some leases are excluded from these rights.
The Leasehold Reform, Housing and Urban Development Act 1993 gives some qualifying tenants of flats a collective right with other tenants similar rights to acquire the freehold or be extend their lease.
The qualifying conditions cover the type of premises, the number of qualifying tenants and what proportion of them that want to participate in a claim. Not every type of property qualifies for right to collective enfranchisement.
It is individuals who may have the right to a lease extension for a flat or apartment (in effect this means a new lease) and under this Act lease must be granted for a term which is equal to the unexpired residue of the existing lease plus 90 year term. Sometimes a premium is payable, possibly at a peppercorn rent or on the existing lease terms.
Law of Property Act 1925 gives opportunities for some owners of leasehold flats to purchase the freehold interest.
A key control and restriction on landlords is created under the Landlord & Tenant Act 1987, meaning that a landlord cannot dispose of its interest in a building that consists of a minimum of least two leasehold flats, held by appropriately qualifying tenants, without previously offering it to certain residential leaseholders.
This covers buildings that may consist of the whole or indeed part, contain two or more residential flats owned by qualifying tenants who must own over 50% of the total number of It should be noted that a house converted into flats could indeed benefit from the right of first refusal created under the Landlord and Tenant Act 1987 and under the Leasehold Reform Act 1967 which gives rights to enfranchise or lease extension.
The Housing Act 1985 gives secure tenants the right to buy, a discount, the freehold or long leasehold interest in their homes if they fulfil certain conditions, and a discount can be applied.
Qualifying tenant for leasehold enfranchisement?
When considering such key life, in a complex area of property legislation, professional advice and guidance is essential. I welcome contact for an initial chat, so please feel free to call me on 01271 386 306.