As a leasehold house owner, subject to certain qualifying criteria, you have a legal right to purchase the freehold of your property including the plot upon which it is built. This is a process known as Leasehold Enfranchisement in accordance with the Leasehold Reform Act 1967.
It requires expert valuation advice to ensure that the premium paid to the freeholder is not excessive, and to ensure that maximum value is added to your property. The shorter your existing lease becomes, the less your property is worth and, consequently the more you will need to pay to buy your freehold. You should, therefore, seriously consider dealing with this issue without further delay.
It should be noted that this is not generally a quick process, and you should consider the need to deal with this long before you are thinking of selling your property. You do not want to find that you need to deal with this issue when you have a buyer ready to proceed. More often than not, this either results in a lost sale or the difficult decision to pay an excessive amount to your freeholder to resolve the short lease.
Even if your property is on the market for sale it is not too late. You can serve the relevant legal notice upon the Freeholder, exercising your legal right to extend or purchase, and this right can then be assigned to your purchaser. This means they will not need to satisfy the 2 year ownership rule, and enables you to sell without the need for a significant discount due to the problem of a “short” lease.
