Will buying the shared freehold make our flat more valuable?

[Gardeningnovice99]

I live in a block of 31 flats and we’ve been offered the chance to buy the shared freehold. (In zone 2 London.)

I am keen because I want control over our service charge, which is astronomical. And our lease is 99 years, so owning shared freehold (to my mind) would make it more saleable as there would be no short lease etc.

And I also thought it would add more value when we sell it on.

Has anyone done this?

Will it make our flat more valuable?

Speak to a specialist surveyor about value. It's complicated.

Not done this but our block considered it. It could be good but share of freehold across 31 flats could be tricky. Next door block of 8 flats did it. First 5 years fab but as many owner occupiers moved out and rented the flats it started to get tricky. But you could use a good MA. It will increase property price if managed well.

Alternative to keep service down is right to manage. Will be cheaper but doesn’t solve problem of decreasing lease.

Is the freehold price good? What does the block think?

Also I think a lot of issues on getting mortgages on leasehold flats is new builds and their crazy ever increasing ground rent.

In my last flat in London we had 78 year least. In negotiating for an extension I brought the headlease on my flat giving me 930 years at peppercorn ground rent. This increased my price massively.

I live in a block of approx 100 flats and a majority of flat owners (which included myself) bought our freehold last year. London zone 2. I think it's 70% majority of owners which must agree to buy the freehold in order for the deal to get through. Legally it's a massively complex area so make sure you get specialist legal advice. As part of the enfranchisement, we are now extending our leases to 999 years (so more legal fees). For me financially, the small gain in value for owning a share of the freehold and a longer lease balanced out against the costs so I pretty much break even.

Note that there's a lot of work involved. We use a managing agent and also formed a limited company to own the freehold (and we are all shareholders with an elected board of directors). We have a Residents Committee too.