Enfranchisement – A Powerful Right

Enfranchisement – A Powerful Right

Dan Ongley, LLP Partner, Griffith Smith Farrington Webb LLP. 

In the hierarchy of statutory rights that flat owners have in respect of their buildings, the right to acquire the freehold - or to use the legal parlance “enfranchise” - is the most powerful of all. At a stroke, flat owners who enfranchise acquire control over the management of their building together with the right to extend and modernise their leases.

However, to achieve this particular goal can require patience, determination and importantly, goodwill and co-operation on the part of the flat owners. In the most common scenario just half of the flat owners in a building need to come together to acquire the freehold, but the value of the freehold is calculated by reference to all of the flats, so it might be fundamental to the owners’ ability to make the claim for all to participate – and to trust that their neighbours will remain committed. This can mean that smaller blocks are more suited to this process, but there are plenty of instances where large blocks of 50 or more flats have been wrested away from landlords into the ownership of well organised groups of flat owners.

Once acquired, flat owners have the ability to extend their leases so that they become “virtual freeholds” with 999 year terms, to modernise and vary their leases to make them more marketable and attractive to mortgage lenders and to manage the building on their own terms, rather than those of a landlord for whom the building represents a business proposition rather than a home.

Enfranchisement is not a magic bullet, maintenance charges will still fall due and neighbours will still fall out from time to time. However, to be able to set the management agenda and, when the time comes, to sell a flat with “share of freehold” writ large on the agent’s particulars, is certainly worth the effort.

For more information contact Dan Ongley on 01273 324041 or email enquiries@gsfwsolicitors.co.uk. 

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