Should we sell a share of our building’s freehold to a neighbour? Experts weigh costs and timelines

A top-floor flat owner and a ground-floor neighbour who share the freehold are weighing whether to offer a share of the freehold to the middle-flat resident, who currently lives under a leasehold arrangement. The middle-flat owner has asked to buy in, and the three-way arrangement could bring additional management input but also more voices at decision time. The group has discussed a target price of about £30,000, though whether that figure proves acceptable will depend on a formal valuation and the terms of the existing lease. Ground rent for the building is minimal, essentially covering the electricity costs for the communal hallway.

This building started life as a single freehold and was later divided into three flats. At some point the middle flat’s owner did not join the freehold sale, so the two other flats bought the freehold between them and now collect the regular lease payments from the middle flat’s lease. The middle flat remains leasehold, with 114 years left on its lease. The question for the current co-owners is whether to invite the middle flat owner to become a co-freeholder and, if so, what price and process would be required to complete the arrangement.

How a share of freehold works was explained by property lawyers and conveyancers. In a typical share-of-freehold setup, each owner retains the leasehold interest in their own flat, while the freehold interest—the ownership of the roof, foundations, and the structure—rests with one or more co-freeholders who also own the flats. The freeholders collectively decide on maintenance, insurance, and day-to-day expenditure, and they can coordinate lease extensions more straightforwardly when needed. This shared governance can simplify tasks such as redecorating common areas or arranging major works, since all co-freeholders have a stake in the property’s upkeep.

When the middle flat joined the discussion, Valuation and conveyancing professionals stressed that the amount paid for a share of freehold is not fixed and depends on several factors. If the middle flat had joined the freehold when it was initially set up, the cost would likely have been modest—perhaps a few thousand pounds—given a low ground rent and the value of the building. Because the middle flat owner did not participate at that time, there is no automatic right to join now, and the price is a matter for negotiation based on current leases and any potential lease extensions. A formal valuation is usually the first step in determining a fair premium, and both sides typically bear legal fees in addition to the purchase price.

A Royal Institution of Chartered Surveyors (RICS)–level valuation is commonly used to determine the premium, and this valuation helps inform the negotiation between the parties. Legal fees on each side often run around £1,000, with the process typically taking four to eight weeks. Costs can also include valuation fees and conveyancing for both sides, plus any tax liabilities that arise. The exact timeline depends on the speed of the lawyers and the efficiency of title updates and the share-ownership arrangement.

The practical benefits of all residents owning a share of the freehold include shared responsibility for the building’s upkeep, from arranging insurance to overseeing statutory requirements such as fire risk assessments. A three-way ownership can feel more democratic, and it may make certain improvements, such as installing electrical vehicle charging points, easier to pursue with broad consensus. In some cases, having three co-owners can streamline decisions about major works since everyone has a direct stake in the outcome.

Yet there are notable drawbacks. Disagreements between co-freeholders can slow decisions or stall projects, and the more people involved, the greater the potential for deadlock. Each time a lease is sold or a new co-freeholder is sought, all owners must sign off on the changes, which can complicate transactions if one party becomes uncooperative or difficult to reach. There is also the question of future extensions: while a share-of-freehold arrangement can make extensions easier, it is still subject to the group’s ability to agree, and a middle-floor owner’s extension prospects may be more constrained than those on the top or bottom floors.

From the middle-flat owner’s perspective, buying a share of the freehold can increase the property’s market appeal by offering more certainty around management and potential lease extensions. It is not guaranteed to boost value by the amount paid, particularly if the middle-flat’s lease already has substantial remaining terms and the market for leaseholds remains sensitive to control and the quality of management. In any case, there is no obligation to sell a share of freehold; it remains a voluntary arrangement, and negotiations will hinge on the perceived value to each party and the terms that a valuer and lawyers can agree on.

For readers facing a similar choice, the core takeaway is that a share of freehold can offer improved management and potential for smoother future lease extensions, but it also introduces more owners into decision-making and can complicate governance if consensus cannot be reached. The path to a deal typically begins with an independent valuer assessing a premium, followed by input from conveyancers experienced in freehold enfranchisement. Prospective co-freeholders should consider whether all parties are prepared to participate equally and whether the necessary long-term commitments, such as annual maintenance planning and major works budgeting, align with their expectations.

Ultimately, the decision to sell a share of the freehold to a neighbour is a negotiation grounded in valuation, governance capacity, and long-range planning for the building. While the prospect can offer greater control and shared responsibilities, it hinges on everyone’s willingness to collaborate and to align on a shared plan for future improvements and lease management.