Lease Extension and Enfranchisement Specialists

020 7499 8043 | 0800 470 1117 | info@richardjohnclarke.com

Collective Enfranchisement - buying the freehold

Richard John Clarke Chartered Surveyors Collective Enfranchisement Valuers: Experience

How much will a Collective Enfranchisement cost (purchasing your freehold)?

Richard John Clarke are experienced specialist collective enfranchisement valuers with a proven track record of achieving great results for our clients.

We are members of the Royal Institution of Chartered Surveyors (RICS), RICS Registered Valuers (RRV’s) and members of the Association of Leasehold Enfranchisement Practitioners (ALEP).

Our aim is to help our clients achieve their collective enfranchisement at a reasonable cost to them.

We currently deal with approximately 300 lease extensions and collective enfranchisements per year.

We have been practising carrying-out lease extensions and collective enfranchisements since 2007.

Whilst it’s still rare, we often appear at the First-tier Tribunal on behalf of our clients to ensure they get a fair deal (click above to look at our most recent tribunal decisions)

If you would like to Collectively Enfranchise (buy your freehold) at a reasonable cost, instruct Richard John Clarke Chartered Surveyors to carry out the valuation and negotiations on your behalf.

For a Free No obligation quotation please call our Freephone number on 0800 470 1117, email us or complete the form below.

 

The costs of Collective Enfranchisement can be significant but are frequently not much more than the individual costs of Lease Extensions for each of the flats.

As there are very often savings to be made from acting in bulk, the total professional fees including the freeholders’ and your own, are likely to be lower per flat.

In order to set a budget, Richard John Clarke provide free no-obligation quotations of our valuation/negotiation costs for our potential clients.

Our fees are set on a fixed price basis, so our clients know from the outset what our charges are going to be to complete the Collective Enfranchisement.

We can also seek quotes from one of our recommended Collective Enfranchisement Solicitors to deal with the legal aspects of the claim.

Where it is possible, we will also provide a “ballpark estimated” figure for the Collective Enfranchisement Costs payable to the freeholder.

 

For a Free No obligation quotation please call our Freephone number on 0800 470 1117, email us or complete the form below.

In addition to your own costs, the Freeholder is allowed to charge for being compelled to sell the freehold. This includes 5 distinct costs which are described below:

  1. Capitalised Ground Rent, of each flat, is found by applying the Ground Rent Multiplier to the ground rent, which can vary from 14 to 30 times the ground rent depending on the amount of ground rent, the frequencies of reviews and the amount of increase at review. Onerous ground rents (eg ground rents that double every 10 years) will cost many more times this. Richard John Clarke argue for a lower multiplier on behalf of our leaseholder clients.
  2. Reversionary Value is the “share of freehold” value of each flat, discounted at an interest rate of 5% for each of the years that remain on the lease. This figure varies from approximately 1% of the “share of freehold” value at 95 years unexpired but increases to 95% at 1 years unexpired! Freeholders’ initially tend to inflate the value of each flat rather than adopt a fair valuation. Richard John Clarke argue for lower reversionary values on behalf of our clients.
  3. Marriage Value, only payable for flats with 80 years or less unexpired, this is an extra payment calculated at 50% of the additional value created by enfranchising the building and giving each flat a “share of freehold”. This payment is between 1% and 11% of the “share of freehold” value of each flat. Richard John Clarke argue for a low marriage values on behalf of our leaseholder clients.
  4. Development Value, payable only when the freeholder can show he will lose value by not being able to develop part of the freehold. Typically, freeholders claim development value for roof space and gardens, but the value will depend upon each building. Richard John Clarke often argue this value is zero for our leaseholder clients.
  5. Professional Fees, known as Section 33 costs, represent the freeholders’ legal and valuation costs. The guiding principle is that these are limited to “reasonable costs” but very often amount to several thousand pounds. These costs vary as each Collective Enfranchisement is different with some blocks being quite small (minimum and most common block have just 2 flats) compared to others which are larger blocks (the largest block we have dealt with had 157 flats). However, the freeholders are not entitled to claim for the costs of negotiations or preparing/attending the First-tier Tribunal. These fees need to be checked and if necessary, challenged to ensure they are fair. Richard John Clarke and our Solicitor colleagues always check these costs are reasonable for our leaseholder clients.

Do you qualify for a Collective Enfranchisement (to purchase your freehold)

The Leasehold Reform, Housing and Urban Development Act 1993 gives flat owners the right to a collective enfranchisement (purchase the freehold of their building) providing the following conditions apply:

  • at least 50% of the flats' owners must participate
  • the costs for the non-participant flats will need to paid for by the participants (those flat owners that seek to Enfranchise are known as “participants”)
  • the building must contain 2 or more flats
  • Qualifying Leases need to have been granted for 21 years or more
  • The building must contain flats where at least 2/3rds of the leases are qualifying leases (blocks where over a 1/3rd are retained by the local authority for social housing will not qualify)
  • the building must not contain more than 25% of commercial space
  • if there are only 2 flats, both flat owners need to participate
  • The cost of the Enfranchisement is not necessarily borne equally by each flat owner as each flat and each lease may have a different value and lease terms.
  • An agreement between participants which describes how the cost of the Enfranchisement is split and other issues is known a “participation agreement” and is generally recommended

These rules are quite complex so please feel free to call us for clarification on Freephone 0800 470 1117.

Collective Enfranchisement Solicitors

Collective enfranchisement is a complex process, including both legal and valuation specialisms.  In order to deal with the legal aspects of the process, we work with specialist collective enfranchisement solicitors, who have experience in this area of the law:

Our recommended Specialist Collective Enfranchisement Solicitors are as follows:

  1. Toni Tripp, PA to Jason Winton of Thirsk Winton Solicitors  Swan House 9-12 Johnston Road Woodford Green Essex IG8 0XA Tel: 020 8505 4777
  2. Angela Alexiou of YVA Solicitors  YVA House 811 High Road North Finchley London N12 8JT t:  020 8445 9898
  3. Mark Chick or Chris Macartney of Bishop & Sewell Solicitors  59-60 Russell Square London WC1B 4HP Tel 020 7631 4141

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020 7499 8043

info@richardjohnclarke.com

11 Masons Arms Mews

Mayfair

London

W1S 1NX

2018 © Richard John Clarke Chartered Surveyors

020 8505 2065

info@richardjohnclarke.com

Swan House

9-12 Johnston Road

Woodford Green

Essex IG8 0XA