At Keywest, we specialise in offering a huge variety of Leicester properties for sale, including leasehold properties. If you have never bought a leasehold property before, some of the associated jargon can be confusing.

As always, however, the experts at Keywest are on hand to help with our guide to some of the most common terms of interest to leaseholders.

Freeholder and Leaseholder

First and foremost, it is essential that you understand the difference between being a leaseholder and being a freeholder. The freeholder is the landlord or lessor and is the person who owns the building in which the property, usually a flat, is situated. As a leaseholder, you will be the owner of a lease allowing you to occupy the property under certain conditions and terms.

The freeholder may set rules which are included in the lease. They may demand that you ask before making alterations, for example.

Lease

The lease is a contract setting out the terms of ‘ownership’ and may include covenants or regulations and rules relating to your chosen property. By buying or signing this lease, both the freeholder and you as the leaseholder are agreeing to abide by these covenants.

Your lease will also stipulate the service charges and ground rent that will be payable to the freeholder.

Ground Rent

The ground rent is a yearly fee to the freeholder, although it may be paid quarterly or six-monthly. The charge may be a fixed sum or rising ground rent. This will depend on what is stipulated in the lease.

The ground rent may be changed with the agreement of the freeholder and leaseholder and could be reduced to what is known as a ‘peppercorn’ rate in the case of an extension claim.

Leaseholder Enfranchisement

This is a term covering a number of factors. These include lease extensions, collective enfranchisement, right of first refusal and right to manage claims.

Collective Enfranchisement

As the leaseholder, it is possible that you can make the most of the right to purchase the freehold in your building. There are very strict requirements, however, and the main facet of this is that you must join with the other leaseholders who occupy property in your building to buy the freehold interest.

There are several benefits to collective enfranchisement – it may allow you to manage the block to the advantage of residents and pay a lower service charge, and you could extend the lease to cover a longer term without having to pay a premium.

This short guide will hopefully have removed some of the confusion surrounding leasehold properties in Leicester, but if you still have any questions do not hesitate to get in touch 01162544555.