A Guide to Buying the Freehold of Your Home If you own a leasehold property, then whilst the ‘bricks and mortar’ of your home are yours, you don’t actually own the ground they stand on. However that’s no reason to worry, as provided that you meet the right criteria, you have a legal right to buy the freehold of your property at any time. On this page: Freehold vs. Leasehold: What do these terms mean?Do I qualify to buy the freehold of my home?Should I buy the freehold of my home?How do I buy the freehold of my home?I live in a flat does this make a difference? In this blog post, we’ll guide you through the process of buying your freehold, and explain what the benefits are to doing so. Freehold vs. Leasehold: What do these terms mean? First of all, you may wish to understand the difference between freehold and leasehold. If you own a leasehold property, then you own the property itself but not the ground below it, which is owned by the freeholder – and you may be subject to paying annual ground rent to the freeholder, or landlord. You can find out who owns the freehold of a property through a Land Registry search. This information is required if you wish to take out a mortgage on the property. Buying the freehold of your house would mean you own the full freehold. Do I qualify to buy the freehold of my home? If you wish to purchase the freehold of the property you own, you must meet certain criteria. The property must be ‘reasonably considered’ a house. The house must be held under a long lease (Originally for a term of more than 21 years or with a right to renewal). The house must have been owned by you for more than two years from the date of registration at the Land Registry. You don’t need to be living in the property. Should I buy the freehold of my home? There are many advantages to owning the freehold of your home. You would no longer be liable for paying any ground rent or service charges to the freeholder and if you are thinking about selling your home, then owning the freehold may also make it more attractive to potential buyers. However, there are costs attached to buying the freehold of your home that may influence your decision. In addition to legal fees, the cost of buying the freehold, which will need to be calculated by a chartered surveyor, will depend on the following factors: The rateable values of the property at different dates The ground rent The number of years left on the lease The current value of the property New laws have made it much easier for leaseholders to buy their freehold – for more information, take a look at the government’s information on buying the freehold of a leasehold property. If your reason for buying the freehold of your property is because it has a short lease, you could consider extending the lease instead. The Leasehold Advisory Service has a free calculator to help you calculate the cost of a lease extension, so you can compare it with the cost of purchasing the freehold. How do I buy the freehold of my home? The Leasehold Advisory Service thoroughly explains the procedure of buying the leasehold of your property here. As with the process of purchasing your property, you may need to appoint a solicitor to manage the purchase of your freehold and ensure that the legalities of your purchase have all been covered. To cover the costs of buying your freehold, you may be able to extend your mortgage. Speak to your mortgage lender to discuss this, and find out whether this may be an option for you. I live in a flat does this make a difference? In a word yes. It is a complicated process and not for everyone. Most flats are leasehold however, although you can buy the freehold you can’t do this on your own. Your neighbours will need to be involved too. At least half the leaseholders in the building must agree to buy the freehold of the block from the freeholder/landlord. Once purchased the flat-owners would own the freehold of the building, often by setting up a limited company with all flat-owners being Directors. You would still have a flat with a long lease, however instead of the lease being with the old freeholder/landlord, it would be with the new legal entity that owns the freehold which is owned by you and your neighbours. You and your neighbours could now set ground rents, repair budgets and insurance. Freehold flats are rare and come with benefits and challenges. Please seek advice if you are looking into buying the freehold of your flat. Your mortgage will be secured on your home. Your home may be repossessed if you do not keep up repayments on your mortgage. For any queries you may have about mortgages with Newcastle Building Society, you can speak to one of our qualified mortgage advisers on 0345 606 4488, or book an appointment at your local branch. Gifted House Deposits: What Do You Need to Consider?Right to Buy: Can I Buy my Council House?