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Enfranchisement made easy - maybe!

Written by: Mary-Anne Bowring 02/09/2020
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1. The Complexity of Enfranchisement

If you're thinking of buying your freehold or extending your lease you will have worked out by now that enfranchisement isn't a simple process. If the whole system seems skewed towards your landlord or freeholder, that's because it is. But all that may be about to change, with a set of proposals from the Law Commission which aim to simplify the process and put more power in the hands of leaseholders. The proposals are now out for consultation and a final report will be published in 2019, providing the government with recommendations for next steps.

2. Simplification of the Enfranchisement Process

Proposals now being consulted on include: The enfranchisement process to be simplified with standard forms used by all parties and the current complex legal framework to be replaced by a single enfranchisement regime.

3. Extending Lease Length and Freehold Acquisition Rights

Existing rights to take out a new lease to be retained but the length of the possible lease to be increased to 125 or 250 years (currently 50 years for houses and 90 years for flats). Existing rights to acquire the freehold of a property to be retained but those rights to be extended to let multiple buildings on an estate acquire the freehold of the whole estate, rather than just one building, with a new "enfranchisement company" to be set up by leaseholders for that purpose.

4. New Right to Participate in Freehold Purchases

A new 'right to participate' to be introduced so that leaseholders who do not take part in an original freehold purchase can join the enfranchisement company at a later stage by paying a specified sum of money.

5. Resolving Disputes Through the Property Tribunals

All enfranchisement disputes to be dealt with by the First-Tier planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>Tribunal (Property Chamber) in England or the Leasehold Valuation planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>Tribunal in Wales.

6. The Potential for Simplifying Leasehold Valuations

Calculating the cost to flat owners of either extending a lease or buying their freehold is really complicated - even for most of us in the property industry! A simpler version may now be on the cards with the Law Commission asking valuation experts for new ideas. All of this must be good news for Ringley customers. The consultation closes in November with results expected next year. Change takes time but in future the whole system may be a little easier to negotiate. At Ringley we have a legal department that is dedicated to helping our customers deal with a whole range of property issues. If your lease is nearing the pinch point of 80-years and you'd like to extend it, or you have a question about buying your freehold, our specialist solicitors should always be your first port of call.



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