There are over 4.6 million leasehold dwellings in England according to DLUHC estimates, and a significant proportion of those leaseholders have the legal right to purchase their freehold through a process known as enfranchisement. At HouseCheckup, our £24.99 property reports include tenure information, lease details, and ground rent data, helping buyers and existing leaseholders understand their position before pursuing a freehold purchase that could add 10–15% to their property's value.
What Is Freehold Purchase (Enfranchisement)?
Enfranchisement is the legal process by which a leaseholder acquires the freehold of their property. There are two main types:
Individual Freehold Purchase
This applies primarily to houses held on long leases. Under the Leasehold Reform Act 1967, qualifying tenants of houses have the right to buy the freehold at a fair price determined by a statutory formula.
Collective Enfranchisement
This applies to flats in blocks. Under the Leasehold Reform, Housing and Urban Development Act 1993, qualifying tenants can collectively purchase the freehold of their building. At least 50% of the qualifying tenants in the building must participate.
Do You Qualify?
Houses
To qualify for individual freehold purchase of a house, you must meet the following criteria:
- Your lease was originally granted for more than 21 years
- You occupy the house as your residence (or have done so for the last 2 years)
- The property is a "house" within the meaning of the Act (this can include properties that look like flats but are structured as houses)
Flats (Collective Enfranchisement)
For collective enfranchisement of a block of flats:
- The building must contain at least two flats
- At least two-thirds of the flats must be held on long leases (over 21 years originally)
- At least 50% of qualifying tenants must participate in the claim
- No more than 25% of the building can be non-residential
- Individual participating leaseholders must have owned their flat for at least 2 years
How Much Does It Cost?
The cost of purchasing your freehold has several components:
The Freehold Price
This is the amount you pay to the freeholder for the freehold interest. It depends on several factors:
- Remaining lease length: Shorter leases cost more because the freeholder is giving up a more valuable reversion
- Ground rent: Higher ground rents increase the price because the freeholder loses more income
- Property value: More valuable properties command higher freehold prices
- Marriage value: For leases below 80 years, the leaseholder must pay 50% of the "marriage value": the increase in property value resulting from merging the leasehold and freehold interests
Typical Freehold Purchase Prices
| Remaining Lease | Property Value £300K | Property Value £500K |
|---|---|---|
| 90+ years | £3,000–£8,000 | £5,000–£15,000 |
| 80–90 years | £5,000–£15,000 | £10,000–£25,000 |
| 70–80 years | £15,000–£35,000 | £25,000–£60,000 |
| 60–70 years | £30,000–£60,000 | £50,000–£100,000 |
| Below 60 years | £50,000+ | £80,000+ |
Figures are indicative. Actual costs depend on the specific valuation assumptions used.
Professional Fees
In addition to the freehold price, you'll need to budget for:
- Your solicitor: £1,500–£3,000 for the legal process
- Your valuer: £500–£1,500 for a professional valuation to support your claim
- The freeholder's reasonable legal and valuation costs: You are required by law to pay these, typically £1,500–£5,000
- Tribunal fees: If the matter goes to the First-tier Tribunal (Property Chamber), fees are relatively modest (£100–£300) but you may incur additional professional costs
The Freehold Purchase Process
- Check your eligibility: Confirm you meet the qualifying criteria (see above)
- Get a professional valuation: Instruct a specialist leasehold valuer to calculate the likely freehold price
- Serve an Initial Notice: This is the formal notice to the freeholder that you wish to purchase. It must include your proposed price. For collective enfranchisement, this is served by a nominee purchaser (typically a company set up by the participating leaseholders)
- Freeholder's Counter-Notice: The freeholder has 2 months to respond, either accepting your price, proposing a counter-offer, or challenging your right to enfranchise
- Negotiation: Most cases are settled through negotiation between the parties' valuers
- Tribunal (if needed): If agreement cannot be reached, either party can apply to the First-tier Tribunal to determine the price
- Completion: Once the price is agreed or determined, the legal transfer is completed, typically within 2–4 months
The Leasehold Reform Act 2024 Changes
The Leasehold and Freehold Reform Act 2024 introduced several changes designed to make freehold purchase cheaper and easier for leaseholders:
- Removal of marriage value: The Act abolishes marriage value for leases below 80 years, significantly reducing the cost for leaseholders with shorter leases
- Standardised valuation: A new standardised valuation methodology is being developed to reduce disputes and professional costs
- Removal of the 2-year ownership requirement: Leaseholders can claim from day one of ownership (once implemented)
- Extended lease length on extension: Lease extensions will be for 990 years at a peppercorn (zero) ground rent
Note: Many provisions of the 2024 Act are being implemented in phases. Check current implementation status before relying on these changes.
Why Buy Your Freehold?
The benefits of freehold ownership are substantial:
- Elimination of ground rent: No more annual payments to a freeholder
- Control over management: You (or your collectively-owned company) manage the building, controlling service charges and maintenance decisions
- Increased property value: Freehold properties typically sell for 10–15% more than equivalent leasehold properties
- No lease expiry concerns: No more watching your lease diminish in value as the term shortens
- Freedom from lease restrictions: You can make alterations, sublet, or keep pets without freeholder consent
Check Your Leasehold Position
A HouseCheckup report for just £24.99 shows tenure information, remaining lease length, ground rent details, and comparable sales data for any property in England and Wales. Whether you're a leaseholder considering freehold purchase or a buyer evaluating a leasehold property, our report gives you the essential data to understand the costs and benefits. At £24.99, it's the most affordable way to assess your freehold purchase potential before instructing expensive solicitors and valuers.
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