Maximising the value of your property investment
As the owner of a leasehold property, there are a number of steps you can take to maximise the return on your investment or achieve the best possible price on resale, including:
- extending your lease
- purchasing your freehold
- Right to Manage
Woodfords has particular expertise in these types of acquisitions, either through agreement with your landlord or compelling them by exercising your statutory rights. We advise numerous clients on these matters throughout London and especially in Fulham, Chelsea, Putney and Wandsworth, where there is a high proportion of leasehold accommodation.
Extending your lease
The cost of extending your lease is partially based on current market values, so the most cost-effective time to extend the lease term on an apartment or maisonette is when property prices are depressed.
If the amount of time left on your lease term is approaching 80 years, you should consider extending it in any event as the cost of doing so markedly increases below this threshold. It may also have a negative impact on mortgage availability for you or a future purchaser, making it more difficult to sell.
Purchasing the freehold
Owning a leasehold property normally means you own the interior of your property but not the land and building. The freeholder generally owns the building and you reimburse the cost of maintenance, insurance and the payment of ground rent.
When it comes to selling your property it can be less attractive without the ownership of the freehold, so it’s a good idea to consider purchasing this. If so, the cost of purchasing a freehold is relative to the remaining term of all the leases the land is subject to, so the sooner you buy the less it will cost .
This process can sometimes be undertaken with the agreement of the freeholder, but you also have the legal right to compel the freeholder to sell the freehold. This is known as freehold enfranchisement or collective enfranchisement and is subject to a number of conditions, including that at least 50% of the tenants must participate.
The tenants benefit in a number of ways including:
- taking control of their building and management
- reduction of excessive maintenance costs
- resolution of landlord/tenant disputes
- ability to extend leases to their maximum levels for no additional premium
If you do not wish to purchase the freehold of your apartment, you may still have the option to acquire the right to manage the building in place of your freeholder to take control of these rights and obligations. Please contact us for further information.
Woodfords’ highly experienced team of solicitors has assisted numerous groups of tenants to successfully purchase their freehold in Fulham, Chelsea, Putney, Hammersmith and beyond, making us your ideal partner in this area.