What Does Share Of Freehold Mean

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Today’s property market offers many opportunities to the buyers and a share of freehold is one of them. By having a share of freehold,  buyers can enjoy regular  management of the building in a way that works for them. Yet, it also comes with a higher level of responsibility. This article provides explanation of some advantages and disadvantages for shareholders.

Share Of Freehold Mean

What is a share of freehold?

Share of freehold is a share of land in a building comprising of a set of flats. A shareholder of a property can also be a leaseholder. To be a leaseholder, you must have ownership rights of a flat or flats in a  building you have shared with other owners. Leaseholder exercises his rights based on terms and conditions in the lease. Whereas the freeholder has a freehold title in the building. A buyer enters into a share of freehold arrangement by two most popular methods. In the first method, the freehold title is registered in the name of the company. in other words, by entering into this method you have a share in the company. The second one is where you have your share by having your name on the deeds of the property. In the second method, there is an equal and joint split between the owners of the flats.


There are several advantages for you if you have a share of freehold:

  • As a freeholder you are responsible for repairs and can keep the cost low while assessing the market;
  • It is easier for you to sell a flat in the future with better profit;
  • You can take part in ongoing maintenance and improvement of a building;
  • You can extend your lease with no extra cost and so can save more significant amounts;
  • With the consent from other co-owners, you can ask to change any terms of the lease or get it extended.


There are some disadvantages for you when you have a share of freehold:

  • The regular management of the building can be time-consuming;
  • You also have to seek consent from the co-owners to extend or alter any boundaries. Failure to do so can result in severe sanctions;
  • Maintenance charges can also be huge, which may vary from time-to-time. You should make sure you have a spare pot available for surprising operational costs;  
  • You are also required to have a plan for any have short, medium and long term repairs. This can be a daunting task especially when you need to deal with the co-owners who might not be available;
  • During the sales transaction, you also need shareholders' identification. Obtaining identification can be difficult in their unavailability;
  • You also have a responsibility for filing annual returns of the company. Failure to do so on time can lead to a hefty fine and even may result in the holding company may strike off;
  • There is also a need to agree on the cost for carrying out work and arrange fire risk assessment. Failure to do so can lead to prosecution.

It may seem that there are more disadvantages than advantages to owning to a freehold title. Yet, things are rather easier within a practical context. The list of disadvantages identifies information on responsibilities that freeholder encounters. Most of them are to do with service charges and repairing obligations and the article section of this website provides more in-depth information on these elements.

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