How Many Leaseholders Are Required to Buy the Freehold

How Much to Buy Back an Absent Freeholder?

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    Buying back the freehold from an absent freeholder can be a complex yet beneficial process for leaseholders. An absent freeholder can lead to difficulties in managing the property, maintaining the building, and extending leases. In this blog, we will explore the steps involved in buying back the freehold, the associated costs, and how Leasehold Valuations can assist you in navigating this process.

    Understanding the Concept of an Absent Freeholder

    An absent freeholder is an individual or entity that owns the freehold interest in a property but is uncontactable or unwilling to fulfil their responsibilities. This can cause various issues for leaseholders, such as delays in lease extensions, lack of building maintenance, and difficulty in selling the property.

    Legal Framework and Eligibility

    The right to buy the freehold from an absent freeholder is governed by the Leasehold Reform, Housing and Urban Development Act 1993 and the Leasehold Reform Act 1967. Leaseholders can apply for a vesting order from the court to transfer the freehold to themselves if the freeholder is absent.

    Steps to Buy Back the Freehold

    1. Establishing Absence: The first step is to establish that the freeholder is indeed absent. This involves making reasonable efforts to contact the freeholder through various means such as registered posts, advertisements, and searches.
    2. Forming a Collective Group: Leaseholders should form a collective group to pursue the purchase. At least 50% of the leaseholders must agree to participate in the process.
    3. Valuation: Engage a professional surveyor to conduct a valuation of the freehold. This valuation will determine the amount payable to the absent freeholder.
    4. Applying for a Vesting Order: Leaseholders can apply to the First-tier Tribunal (Property Chamber) for a vesting order. This application must include evidence of the freeholder’s absence and the valuation report.
    5. Tribunal Decision: The tribunal will review the application and, if satisfied, will issue a vesting order. This order transfers the freehold to the leaseholders and sets the purchase price.
    6. Payment and Transfer: Once the vesting order is issued, leaseholders must pay the determined amount in court. The court will then transfer the freehold interest to the leaseholders.

    Costs Involved

    1. Valuation Fees: The cost of hiring a surveyor to conduct the valuation.
    2. Legal Fees: Fees for legal advice and representation during the application process.
    3. Tribunal Fees: Fees for applying to the tribunal for a vesting order.
    4. Purchase Price: The amount determined by the valuation, which must be paid to the court.
    5. Administrative Costs: Additional costs for advertising, searches, and other administrative tasks.

    Benefits of Buying the Freehold

    1. Extended Leases: Leaseholders can extend their leases at no additional cost.
    2. Control Over Service Charges: As freeholders, leaseholders have greater control over service charges and management of the building.
    3. Increase in Property Value: Properties with a share of freehold tend to have higher market value.Freedom from Ground Rent: Leaseholders are no longer required to pay ground rent, which can be a significant financial relief.

    Benefits of Buying Back the Freehold

    1. Control Over Property Management: Leaseholders gain control over the management and maintenance of the property.
    2. Lease Extensions: Easier and cost-effective lease extensions without dealing with an absent freeholder.
    3. Increase in Property Value: Properties with a share of freehold tend to have higher market value.
    4. Elimination of Ground Rent: Leaseholders are no longer required to pay ground rent, providing financial relief.

    Challenges and Considerations

    1. Establishing Absence: Proving the freeholder’s absence can be challenging and time-consuming.
    2. Cost: The process can be expensive, considering the valuation, legal, and tribunal fees.
    3. Legal Complexities: Navigating the legal process requires professional guidance to ensure a successful outcome.

    Factors Affecting the Cost of Buying Back Absent Freeholder

    Factor Description Impact on Cost
    Property Value Current market value of the property Higher property value = Higher cost
    Lease Length Remaining term of the lease Shorter lease = Higher cost
    Ground Rent Annual ground rent payable by leaseholders Higher ground rent = Higher cost
    Legal and Professional Fees Costs associated with legal advice, valuation, and tribunal applications if required Additional costs to consider
    Tribunal Involvement Whether the First-tier Tribunal needs to be involved Tribunal fees and possible delays


    Buying back the freehold from an absent freeholder can be a wise investment for leaseholders, providing increased control and potential financial benefits. By understanding the steps involved and the costs associated, you can make informed decisions and take the necessary steps towards achieving ownership. Leasehold Valuations is here to guide you through every step of the process, from initial valuation to legal formalities, ensuring a smooth and successful journey. Our expert team is ready to assist you in making this important investment with confidence.

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