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You may not be familiar with some of the terms you come across when looking at our website. By way of guidance here’s an explanation which we hope you’ll find useful (but please understand these are not intended in any way to be formal, legal definitions) :-
|Block Enfranchisement||See Collective Enfranchisement|
|Collective Enfranchisement||The right granted by the Leasehold Reform, Housing and Urban Development Act 1993 for the lessees to buy the freehold of their block of flats, provided they meet certain criteria. Sometimes called Block Enfranchisement.|
|Commonhold||A relatively new form of land ownership introduced into England and Wales by the Commonhold and Leasehold Reform Act 2002 relating to blocks of flats. It’s an alternative to long leasehold ownership, which is the traditional English system of tenure for blocks of flats. Each flat is held freehold and the common parts, such as the stairways and gardens, are held and managed by a Commonhold Association (a private limited company of which the unit holders will be members).
In essence this is a system of land ownership which allows for the freehold ownership of a part of a building and communal ownership of the common parts.
|Enfranchisement||The process of obtaining the freehold on a House or a block of Flats. The term is often used generically to cover the entire subject of residential leasehold law.|
|First Refusal||See Right of First Refusal|
|First-tier Property Tribunal||The statutory body which, in the absence of agreement between the parties, may determine the premium for a lease extension or the price of the freehold, for flats and houses. An FtT may also deal with service charge disputes and the appointment of managers.|
|Flat||A Flat (or Maisonette) is a self-contained dwelling unit that occupies only part of a building.|
|Flats||As above but refers to several self-contained dwelling units that together make up a building.|
|Freehold||The highest level (or absolute) ownership of property and land.|
|Freeholder||A person who owns the Freehold.|
|House||For our purposes a House is generally a residential property, which is not divided horizontally into Flats or Maisonettes. A House, as distinct from a Flat, merely requires there to be a vertical separation, and can therefore include terraced and semi-detached properties, as well as detached properties.|
|Landlord||For our purposes a Landlord is the owner of any legal interest in a property superior to (or higher than) someone else’s legal interest. A Landlord is generally the Freeholder, but may merely have an intermediate interest.|
|Lease||The contractual document by which a property is let to a Tenant, giving him the right to use the property for a period of time. As a Lease gets shorter its value decreases, and becomes more expensive to extend. If you do not have a copy of your Lease you can usually obtain this from the appropriate Land Registry or your mortgagee (if you have a mortgage) for a small fee.|
|Lease Date||The date on which a Lease is signed by the Freeholder and Lessee (or Landlord and Tenant).|
|Lease Extension||The statutory right (under the Leasehold Reform, Housing and Urban Development Act 1993) is to extend the lease of your Flat for an additional 90 years. Extensions of other lengths may be agreed with a Freeholder, but these are purely voluntary.|
|Lease Term||The length of time for which a Lease runs (often 99 years), starting on its Commencement Date and ending on its Termination Date. The Commencement Date of a Lease is not usually the same as the date on which the Lease was originally signed.|
|Leasehold||The form of tenure where property is held under a Lease.|
|Leasehold Reform Act 1967||The original Act, still in force with amendments, which gives Lessees the right to buy the Freehold of their House.|
|Leasehold Reform, Housing and Urban Development Act 1993||The original Act, still in force with amendments, which gives Lessees the right to a lease extension on their flat or to buy the freehold of their block.|
|Lessee||The owner of the Leasehold interest in a property, i.e. the person who leases the property from a Lessor.|
|Lessor||The owner of the superior interest in a property (usually the Freeholder), i.e. the person who lets the property to a Lessee.|
|Maisonette||The term Maisonette is often used to describe a Flat that has its own entrance, but for the purposes of the legislation is still a Flat.|
|Marriage Value||This is the latent (or hidden) increase in value of the property arising from the grant of the new lease (or the joining of the freehold and leasehold interests in the case of a house) The legislation requires this potential profit to be shared between the parties on a 50:50 basis. The legislation also stipulates that where the property has an unexpired lease term exceeding 80 years any marriage value is to be ignored.|
|Mortgagee||An institution such as a bank or building society, which lends money to a Mortgagor, the loan being secured on the property.|
|Mortgagor||The owner of the property interest, who borrows money secured against the property.|
|Right of First Refusal||This is the right the Leaseholders have under the Landlord and Tenant Act 1987 to buy the Freehold before it is sold to a third party.|
|Tenant||This is another word to describe a Lessee|
|Valuation Range||A specialist valuer’s opinion of the range of figures likely to be determined by a First-tier Property Tribunal for a Lease Extension, Collective Enfranchisement or Freehold Purchase.|