Collective Enfranchisement
Collective enfranchisement is the statutory right of leaseholders in a qualifying block to buy the freehold together. It ends the ground rent, gives control of the building, and lets participants extend their leases to 999 years at a peppercorn — but it is a purchase, with a price, a process and a management responsibility on the other side.
Plan life after the freehold
Tell us about the block and where you are in the process. We'll explain what managing it will involve and what it costs.
Who qualifies
- The building is self-contained, or a self-contained part of a building
- At least two-thirds of the flats are held by qualifying leaseholders on long leases
- No more than 25% of the internal floor area, excluding common parts, is non-residential
- At least half of the flats participate in the claim
- Buildings with a resident landlord and four or fewer flats are excluded
How the process runs
| Stage | What happens | Typical timing |
|---|---|---|
| Assemble the group | Confirm participation, agree cost sharing, sign a participation agreement | 1–3 months |
| Valuation | Specialist enfranchisement valuer assesses the premium | 2–4 weeks |
| Nominee purchaser | Usually a company limited by guarantee formed to hold the freehold | 2 weeks |
| Initial notice (s.13) | Served on the freeholder with the proposed price | — |
| Counter-notice | Freeholder admits or disputes and proposes a price | At least 2 months later |
| Negotiation | Valuers negotiate; tribunal application possible if no agreement | 2–6 months |
| Completion | Freehold transferred to the nominee purchaser | Typically 6–12 months overall |
What it costs
The premium reflects the value of the freeholder's lost ground rent income, the reversion, and — where leases are short — marriage value. Shorter leases mean a substantially higher premium, which is why acting before leases fall below 80 years matters.
Participants also pay their own legal and valuation fees plus the freeholder's reasonable costs. Leasehold reform legislation has been changing this landscape; take current advice on marriage value and cost liability before committing, because the position has moved recently.
Enfranchisement or right to manage?
| Right to manage | Collective enfranchisement | |
|---|---|---|
| Cost | Process costs only, no premium | Premium plus professional costs |
| Ground rent | Still payable | Extinguished |
| Lease extensions | Cannot grant | Can grant 999-year peppercorn leases |
| Speed | 4–6 months typically | 6–12 months typically |
| Fault needed | No | No |
| Best for | Blocks unhappy with management only | Blocks with short leases or high ground rents |
The day after you own it
Owning the freehold makes the participants the landlord. The company now insures the building, sets and collects the service charge, holds it on statutory trust, consults under section 20 and carries the fire safety duties.
We are typically appointed at completion to run that: first budget, independent insurance placement, a fresh fire risk assessment and compliance baseline, re-tendered contractors, and the company secretarial work for the new freehold company.
Frequently asked questions
How many leaseholders are needed to buy the freehold?
At least half of the flats in the building must participate, and at least two-thirds of the flats must be held by qualifying leaseholders on long leases. The building must also have no more than 25% non-residential floor area.
How much does collective enfranchisement cost?
The premium depends principally on the unexpired lease terms, the ground rents and the property values, so it varies enormously between blocks. Participants also pay their own legal and valuation fees and the freeholder's reasonable costs. A specialist enfranchisement valuation is the only reliable figure.
Should we do right to manage or buy the freehold?
If the only problem is management, right to manage achieves control with no premium. If leases are getting short or ground rents are onerous, enfranchisement is usually the better long-term answer because it extinguishes ground rent and allows 999-year lease extensions at a peppercorn.
Who manages the building after enfranchisement?
The new freehold company does — usually by appointing a managing agent, exactly as an RMC or RTM company would. The statutory duties around service charge, compliance and consultation now sit with the participants' company.