Specialist conveyancing articles to inform you about conveyancing for a house or a flat; whether you already own your own home or if you are buying one. These are free to read and written by specialists in this area.

At SAM Conveyancing we give you all the information you need to know written in a way that makes it easy to understand. We also have a panel of conveyancing solicitors should you need someone to help with conveyancing for buying a home, lease extension, remortgage, transfer of equity, collective enfranchisement, independent legal advice or deed of trusts.

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Section 13 Notice - Buying Your Freehold

21/09/2019
The Section 13 Notice, also known as an Initial Notice, is served by the leaseholders on the freeholder to exercise their rights to collective enfranchisement (buying your freehold). The freeholder is required to reply to the Section 13 notice with a Section 21 Counter-Notice.

What should you do before you serve the section 13 Notice?

  • Check your eligibility
  • RICS Freehold valuation - you need to value the freehold to:
  • know the participating leaseholders can jointly afford to buy the freehold;
  • reduce the risk of serving an incorrect premium in the initial notice, which when disputed by the landlord can delay the process and cause additional negotiating costs with the freeholder - How do you value a freehold purchase? and The cost of buying freehold
  • Choose your nominee purchaser/s
  • Make contact with your freeholder or (if applicable) your intermediary landlord to inform them of your intention and to confirm they aren't absent. NB This also helps you ensure you serve notice on the right person/entity. If you don't, you risk invalidating your notice.

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Choosing the Nominee Purchaser

The Nominee Purchaser, named in the Initial Notice, acquires the freehold and becomes the new landlord if the process completes. You should decide who this is at an early stage because they will become the manager of the building. If you choose to set up a company then this needs to be set up and incorporated prior to serving your section 13 notice.

Along with other participating tenants, you are free to decide who the Nominee Purchaser is. They can be, for example:

  • a person;
  • one of the tenants;
  • a corporate person/external company;
  • a trust; or
  • a company you form with the tenants for the purpose. This is the most common option as it allows for a number of leaseholders to manage the company and share the responsibility of maintaining the freehold and adhering to the freeholder's obligations.

  • What's in a Section 13 Initial Notice?


      1
      Full names and addresses of:
    • the qualifying tenants giving the Section 13 Initial Notice;
    • ALL the qualifying tenants;
    • the landlord/freeholder and any intermediary landlords;
    • the Nominee Purchaser/s;
      2
      Details of the premises you wish to buy the freehold of, including a plan and any relevant description;

      3
      Details of any other freehold interests which you wish to acquire;

      4
      Rights to be required - this refers to such matters as, for example, vehicular access, rights of way, access to drainage - all of these matters should be clearly described and marked using plan diagrams;

      5
      The grounds for your claim. This is where you must state the facts which make your case an eligible one - that 2/3 of the flats are leased by qualifying tenants etc;

      6
      Details of all the leaseholds that are to be purchased (must be completed);

      7
      Details regarding any mandatory leasebacks. This refers to any leaseholders who have the right to continue their leases, such as those with secure tenancies etc. and which must be honoured by the Nominee Purchaser once the process has completed - the present freeholder themselves might well have a mandatory leaseback;

      8
      The price proposed to pay for the freehold and any other interest/s which the qualifying purchasers wish to buy;

      9
      The date by which a counter-notice must be served (must be at least 2 months after the Section 13 Initial Notice is served but no more than 6 months after); and

      10
      The signatures of the Nominee Purchaser/s and ALL the qualifying tenants must be provided at the end of the notice.


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Check that you and other leaseholders are eligible to buy your freehold first

The collective enfranchisement process is a complicated one and there are numerous conditions to fulfil before you can progress to serving a Section 13 Initial Notice under the Leasehold Reform Housing and Urban Development Act 1993.

For example, two-thirds of the flats must be occupied by qualifying tenants and you must have long leases and more than 50% of the qualifying tenants have to want to collectively enfranchise - click on the following link for a more in-depth discussion on eligibility conditions for collective enfranchisement.

You should also note that you have to decide on a Nominee Purchaser to represent the interests of all the participating qualifying freeholders and this is required for serving the Section 13 Notice.

Serving a Section 13 Notice correctly is critical!

A conveyancing solicitor experienced in the area of leaseholders wishing to purchasing their freeholds is fully aware that a Section 13 Notice served on a landlord/freeholder must be complete and with no inaccuracies. If your landlord/freeholder finds faults in the notice, they can apply to court to have it dismissed, which means not only that your application is stopped but also that you cannot make another application for 12 months.

Need an experienced conveyancing solicitor to serve a Section 13 Initial Notice on your freeholder? Call 0333 344 3234 or click here


The Section 13 Initial Notice is a clear milestone in the freehold purchasing process also because all matters of valuation and compensation etc. are calculated from the date it is served and the strict legal timetable which accompanies the formal process is started.

What happens next?

The landlord has to serve their counter-notice by the date specified in point 13 above otherwise you can apply for a Vesting Order.

Assuming they do serve this notice, you can reasonably expect that if you've hired the right professionals, the counter-notice will normally agree to your claim and you can then look to pay the landlord's premium, their compensation and for the final conveyancing required for the process to complete.

NB:

Bullet-1-3PR3Sa.png   Once your solicitor has served the notice, you are liable to pay your landlord's 'reasonable costs', which normally include what they have to pay for their own freehold valuation and their legal representation.

Bullet-2-3HmQ1e.png  If your landlord does not agree with your claim, they must say why in their counter-notice and then, at least 2 months after but not exceeding 6 months, either you or they have the right to take the matter to the First-tier Tribunal (Property Chamber). You have to pay a small sum to access this court but from this point, your landlord must pay for their own costs entirely, which is often the reason they'll choose to settle without taking this option.

You can get an overview of the whole process here

Collective-Enfranchisement-Purchase-of-Your-Freehold-JoIqYx.png
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