Are you searching for a property that stands out from the rest? A property with unique architectural features and the potential for cost-saving opportunities? Investing in a property with a flying freehold might be the answer you’ve been looking for. However, it’s not without its challenges. Legal complexities, shared maintenance responsibilities, and limited buyer pool can make selling a flying freehold property a daunting task.

But don’t worry! In this captivating text, we will delve into the world of flying freeholds, unravelling the mysteries and providing you with invaluable insights. Whether you’re considering investing in a flying freehold or planning to sell one, we’ve got you covered.

Imagine being able to navigate the legal intricacies, educate potential buyers effectively, and price your property competitively to attract the right audience. Picture yourself armed with the knowledge and expertise to make informed decisions, maximising the value of your investment or achieving a successful sale.

We will explore the potential benefits and drawbacks of investing in a flying freehold, the importance of seeking professional advice, and the strategies to overcome selling challenges. You’ll learn how to evaluate market demand, understand legal implications, and stand out in a limited buyer pool. Our experts will guide you through the process, providing you with essential lessons and insights to ensure a smooth and successful real estate journey.

Are you ready to unlock the secrets of flying freehold properties? Read on to discover the keys to a profitable investment and a seamless selling experience. Get ready to take control of your real estate endeavours and turn challenges into opportunities. 

Building with a shared balcony in a flying freehold

Examples of flying freehold

If you have a flat that is built on conventionally and there is a balcony or a room that protrudes out over the land of another building, then this is a common example of a flying freehold and probably the most common type of flying freehold there is.

What are flying freehold problems?

In the process of buying a freehold property, there is a good chance that you have the property or you have had the property for a while and you do not realise that it is a flying freehold.

Most common problems of flying freeholds

When it comes to common problems with flying freeholds, the most common problems that people run into is working out whose responsibility it is to do repairs. For instance, if a property is bordering two places then the two owners could get into conflict about who should actually repair the flying freehold.

Most of the time it is obvious but difficult situations include where the part of one building damages another part of another building that is separate. For instance, if there is a leak on a roof of a building that seeps into the premises of another, it could be hard to work out who is responsible.

Also, if there are no clear guidelines set out in the floor plans or the legal documents for  a building, then where there are new owners that buy the property in the future, there could be a conflict as to who should take care of the property in certain places.

In addition, access to a property is always a problem, sometimes it may be the case that an owner has to enter their property through the premises of another and this could cause disagreements between owners too.

How can you overcome problems and risks with flying freeholds?

In order to prevent common problems with flying freeholds, the most important factor is most likely to be to make sure the legal documents of a property are always up to date and that both owners look over the documents before they sign anything formally to purchase the freehold.

Get flying freehold and indemnity insurance

If you have a property that is a flying freehold, there are a few nuances that may crop up throughout the duration of the ownership of the property which may warrant you to take out a special type of insurance known as indemnity insurance. 

If you are able to find a good deal you may be able to very easily get a hold of this insurance which is known as indemnity insurance and in the grand scheme of things doesn’t work out to be that much.

Flying freehold indemnity insurance will allow you to get away from the large costs that may occur in the future if something were to go wrong much like any other insurance taken out for a home.

An arch of a flying freehold building

You can form a new agreement

If the right type of bonds in an agreement are in place, then this may indicate that you don’t have to worry about any issue that happens between flying freehold properties. For instance, each freeholder’s rights and obligations will be written down.

This means if there is an issue then there will be no confusion about who should step up and cover costs or who should step up and repair. It is already written down in an agreement.

If a freeholder doesn’t cover the costs that they should then the other freeholder that is part of the flying freehold will have a strong case to take to court to urge the freeholder to cover costs.

Change the structure of the freehold

A final way that you can sort out issues that arise as a result of flying freeholds is to change the flying freehold to a leasehold structure. As a result, the owners that are adjoining the freehold would take responsibility.

However, this means the leaseholder will have to give up some of their rights as they lose a significant amount of rights going from a freeholder to a leaseholder.

Like any change in title, this would also have to be given to the land registry and there should be a legal process involved to oversee this. 

How do flying freeholds work with mortgages?

As you may suspect, lenders are very risk averse and generally want to be able to only invest in property that is most likely to produce a return on investment. So, if they find there is a property that could have potentially legal problems down the road, this is an issue.

This is not to say that it is impossible to get a mortgage on a flying freehold having said this as there is a chance that the lender will be able to still lend money if the property has things like a written agreement between freeholders or insurance as mentioned above.

Is it possible to get a mortgage on a flying freehold?

Yes, you can obtain a mortgage on a flying freehold but all lenders deal with how they go about things in different ways. For instance, some lenders will only lend money on a house if there is under a certain percentage of the property classed as a flying freehold.

How this may look in a real life situation is a lender, HSBC for instance found here could find out on behalf of a surveyor or by looking at the legal documents of a property that 10% of the building is a flying freehold. They could then set their restrictions to just 5%.

This would mean the owner of this flying freehold will have to find another lender to go with that has a higher threshold that is perhaps 10% or 15% which would put the freeholder in the right category. The lender perspective

How do flying freeholds look from a lender’s perspective?

You may be able to understand this better if you are able to look at what a flying freehold is from a lender’s perspective. As of 2023, different banks and lenders have different rules on the topic and they are laid out below. Should you avoid investments in flying freehold properties? Is it more difficult to sell a flying freehold property?

Much like a leaseholder will look at costs involved in a property like service charges and ground rents, a lender has to look at these expenses and risks too so they know what lending position to come in with.

LenderLending Position on Flying Freehold
Lloyds Banking GroupWill lend if only a part of the title is a flying freehold.
Nationwide Building SocietyWill lend if only a part of the property is affected.
Santander UKWill lend, but may not accept Title Indemnity Insurance in certain cases.
NatWest GroupWill lend, provided positive covenants can be enforced, with a maximum Loan to Value (LTV) restriction of 90%.
BarclaysWill lend if the flying freehold affects less than 15% of the overall external footprint, and adequate rights of support and mutually enforceable repairing covenants exist.

Is it worth avoiding investment in a flying freehold property?

Investing in real estate requires careful consideration of various factors, and one such consideration is whether to invest in a property with a flying freehold. 

A flying freehold refers to a situation where a part of one property extends over another property, often found in multi-unit buildings or shared structures. While flying freeholds can pose some challenges, it’s important to evaluate whether avoiding investment in such properties is warranted.

Properties with flying freeholds frequently have distinctive architectural features that make them visually appealing and distinct. These features can increase the property’s appeal and desirability, attracting potential buyers or tenants. 

Furthermore, in some cases, properties with flying freeholds may provide cost-cutting opportunities. Maintenance costs for common areas or structural elements can be shared by multiple property owners, reducing individual financial burdens.

The value of any property, including those with flying freeholds, greatly depends on its location and the overall demand in the market. 

Desirable locations and strong demand can outweigh any concerns related to the flying freehold, making investment in such properties potentially lucrative. However, it is crucial to seek legal and financial advice before investing in a flying freehold property. 

Understanding the legal implications, potential costs, and market dynamics will enable investors to make informed decisions.

Is it hard to sell a flying freehold?

The marketability of a property can be a significant concern for potential sellers, especially when it involves a flying freehold. Selling a property with a flying freehold may present unique challenges compared to conventional properties.

The presence of a flying freehold can limit the buyer pool, as some individuals may be cautious about potential legal complexities or future maintenance responsibilities associated with shared elements of the property. 

Consequently, it may take longer to find a suitable buyer who is comfortable with the flying freehold arrangement and sellers of flying freehold properties may need to invest extra effort in educating potential buyers about the concept and addressing any concerns or misconceptions they may have. 

Providing clear information and documentation, along with professional advice, can help ease buyer apprehensions.

The selling price of a flying freehold property should be realistic and reflective of the property’s unique features, potential advantages, and any associated limitations. 

Pricing the property competitively can attract interested buyers and compensate for any perceived drawbacks related to the flying freehold.

Working with experienced real estate agents and legal professionals who have expertise in flying freehold transactions is essential. These professionals can guide sellers through the process, navigate legal complexities, and assist in marketing the property effectively to potential buyers.

While selling a flying freehold property may pose challenges, it is not an insurmountable task. With proper preparation, pricing, and professional support, sellers can successfully navigate the market and find interested buyers who appreciate the property’s distinctive features. 

As with any real estate transaction, patience, flexibility, and open communication are key to achieving a successful sale like those seen on popular listing platforms like rightmove here.

A flying freehold

To conclude

Investing in a property with a flying freehold can offer unique architectural features and potential cost-saving opportunities. 

While some challenges exist, such as legal complexities and shared maintenance responsibilities, it’s important to assess the value of these properties based on location and market demand. Seeking legal and financial advice before investing is crucial to make informed decisions.

Selling a flying freehold property can present challenges due to limited buyer pool and concerns about legal complexities and future maintenance responsibilities. 

Educating potential buyers about flying freeholds, providing clear information and documentation, and pricing the property competitively can help overcome these challenges.

Working with experienced real estate agents and legal professionals is essential for a successful sale.

All in all, it is important you evaluate the potential benefits and drawbacks of investing in a flying freehold property, considering unique architectural features, cost-saving opportunities, and market demand.

And seek legal and financial advice before investing in a flying freehold property to understand legal implications, potential costs, and market dynamics too.

Finally, you should educate potential buyers about flying freeholds when selling a property, addressing concerns and misconceptions, price the property competitively, considering its distinctive features and potential advantages.

By considering these lessons and insights, individuals can make informed decisions when investing in or selling a flying freehold property, ensuring a smooth and successful real estate experience.

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Donnell Bailey

Property expert

Donnell is a property expert focusing on the property market, he looks at a combination of legislation, information from property managers, letting agents and market trends to produce information to help landlords.


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