The Right of First Refusal gives leaseholders in a freehold property the opportunity to collectively purchase the freehold to the building in which they own a flat/apartment. The Right of First Refusal is provided by Part 1 of the Landlord and Tenant Act 1987. Leaseholders are offered the Right of First Refusal by way of a Section 5 Notice.
A Section 5 Notice is a document that is provided to qualifying leaseholders when selling a freehold property. It both informs the tenants of your intention to sell and offers them the Right of First Refusal to purchase the freehold collectively. Learn more about the Section 5 Notice here.
A qualifying tenant includes leaseholders and most fixed or periodic tenancies excluding shorthold or assured tenancies. A qualifying tenant is restricted to owning no more than 2 flats in the building.
If your freehold property has been your only principal residence for the last 12 months, you will be exempt from offering the Right of First Refusal. Find out more here.
No, you do not need a solicitor to prepare and serve Section 5 Notices. We can provide this service on your behalf and in most circumstances we can do this at no cost to you. Learn more about our Section 5 Notice Service.
This is a legal document and it is therefore advisable to seek the assistance of an industry professional or qualified solicitor to prepare and serve Section 5 Notices. It is important to issue the notice correctly in order to avoid an illegal disposal which could result in the disposal being challenged by the leaseholders.
The landlord’s offer is served on a ‘take-it or leave-it’ basis and is not negotiable. The disposal would be deemed illegal should the landlord sell for a lower price than that stated in the offer notice.
Leaseholders have two months to accept the landlord’s Right of First Refusal offer. However, this can be four months when selling your freehold through an auction house. Learn more about selling your freehold here.
Leaseholders qualify for the Right of First Refusal so long as they do not own more than three flats in your building. This includes most fixed or periodic tenancies but excludes business and agricultural tenancies.
A resident landlord is someone who lives in the building as their only or principal residence and has done so for more than 12 months. The property must not be a purpose built block of flats, it must be a house converted into flats from its original construction.
You will need to offer the Right of First Refusal if your freehold property contains at least two flats, more than 50% of the flats are held by qualifying tenants and no more than 50% of the property is in non-residential use. Resident landlords are exempt. Learn more about the Right of First Refusal here.
We can usually prepare and servce Section 5 Notices to your tenants within 24-hours, subject to having access to the leases and title information. For freeholds comprising of a large number of leases we may need more time to facilitate this service. Learn more about our Section 5 Notice service.
Our Right of First Refusal service is free when you sell your freehold interest to us. However, in most cases we can also provide this service for free when a freeholder is selling to a third party. Find out more.
Yes, we can buy freehold ground rents before the development has completed and before the properties have been sold. Please contact us to discuss your development with one of our consultants.
Yes, you can sell a freehold that you’ve inherited. There are certain legal requirements that you should be aware of but the process can be relatively simple so long as you choose a reliable buyer. Learn more about how to sell an inherited freehold here.
This varies between properties and is based on a number of different factors. Our offers are always competitve and based on the market value of your freehold.
This depends on the selling avenue that you choose to sell your freehold interest. It’s advisable to confirm this time frame with the buyer/ selling avenue. If you sell to Freehold Sale, we will transfer the sale proceeds to your solicitor and they will be released to you on completion.
A freeholder can refuse to sell the freehold if the leaseholders are not eligible to purchase it. Leaseholders are eligible if they have a long lease of more than 21 years and do not own more than two flats in the building.
Yes, a freeholder can sell the freehold at any time but they must always offer the Right of First Refusal to qualifying tenants. If the tenants do not wish to purchase the freehold, the freeholder then has the option of a private sale. Or you can notify the tenants of a sale by auction which requires a different form of notice.
We buy residential freehold properties of all sizes across England and Wales. This includes purpose built blocks of flats and converted buildings containing at least two flats or apartments. Discover how to sell your freehold here.
You will be legally obliged to do this if your freehold property meets certain criteria and if your tenants qualify for the Right of First Refusal. Read our Right of First Refusal Guide for more information.
Profit from the sale of such an asset is subject to tax. You should seek advice from a qualified person as to whether tax will be payable on your sale and how much this will amount to.
The freehold selling process duration depends on how you choose to sell your freehold interest. If you have qualifying tenants, you may need to offer them the Right of First Refusal. This takes between two and four months depending on the selling avenue you have chosen. To find out more read: ‘How long does it take to sell a freehold?‘
This depends on how you choose to sell your freehold interest and any requirements to offer the Right of First Refusal to the leaseholders. The good news is that Freehold Sale specialise in helping our customers to dispose of their freehold quickly. We aim for the sale to complete within four to eight weeks of receiving the contract from your solicitor. For more information read: ‘How long does it take to sell a freehold?‘
Ground rent sale means the sale of a freehold property containing multiple leasehold units i.e. a block of flats or a single leasehold house, where each leaseholder pays a ground rent to the freeholder/landlord.
There are various different ways to sell freehold ground rents. These include using a specialist freehold buyer like Freehold Sale, selling at an auction house, or selling to the leaseholders. Do your research to find the option that suits you best. Read our ‘Top ten tips for freehold sellers‘ for more advice.
