01708 757575 mbs@ker.co.uk Enterprise House, 18 Eastern Road, Romford, Essex UK, RM1 3PJ

Buying your freehold from Persimmon Homes

Government pressure on building has over the last few years resulted in some relief from onerous terms and conditions imposed by developers. Similar to the Taylor Wimpey ground rent scheme  Persimmon homes has now changed the way it charges owners who want to buy the freehold of their house – converting the leasehold house to a freehold one.

We are specialist solicitors who can help you purchasing your freehold from Persimmon Homes.

How Much Do I Need to Pay to purchase the freehold?

Persimmon say  “Where Persimmon still owns the freehold of your leasehold house and the leasehold house was sold by Persimmon on or after 1 January 2000, we’ll offer you the chance to buy the freehold for no more than £2,000”.

In theory the cost of the freehold can be less than £2000 but in practice to convince Persimmon to sell it for less you need to obtain a formal valuation by “a suitably qualified valuer to calculate the market value of the freehold by reference to the statutory valuation principles contained in the Leasehold Reform Act 1967”. This means that you have the cost of the valuation to pay for and in all likelihood because of the value of the ground rent payable you are not likely to see a lower price anyway. It therefore seems that any price of less than £2000 will be acheived.

Is the price offered by Persimmon fair?

We are not valuers but this capped price is broadly good news and seen by most commentators as a fair price because, as noted above,  for many the ground rent payable under the lease would be £200 or more a year which means as an investment paying £2000 would reduce this rent to nil and this is a “return” of  10%. Ground rent investments are normally sold at around 20 x the ground rent and we understand that previous to this decision Persimmon were demanding 25 x your ground rent to sell you the freehold (although we also understand that anyone who purchased in this way will be offered a refund). As the developer does not charge for their legal costs (as they would be entitled under the Leasehold Reform Act for example) this makes the overall offer even better.

You also need to consider the intangible benefit. The purchase of the freehold removes the “stigma” often attached to new build leasehold houses and many buyers will of course prefer to own the freehold of their house outright (most houses in England and Wales are freehold and most flats are leasehold). Whether this directly affects the market value of the property is less clear but it is likely to make your property more marketable in the future and more understandable to the average buyer who wants to see a freehold house to buy.

Are their any other advantages to the scheme?

The scheme does remove some of the often criticised ‘permission fees’ i.e. fees payable for us to consent to e.g. alterations to the property which are imposed in the lease. Again this can only help on resale and if you want to extend your own property.

Management Company

We think it is worth saying that owning the freehold does not remove the need to be bound by and a party to the management schemes which you often have maintaining “amenity” areas on the estate. The purchase of the freehold does not allow you to opt out of this arrangement and the new transfers require you to enter into a binding arrangement to pay towards the management charges via a “rentcharge”.

We understand the criticism around management companies are that sometime the administration charges outweigh the actual work carried out on the estate but this cannot be addressed by this scheme. You must enter into a binding arrangement with the management company in the freehold transfer.

It is unfortunate that rentcharges have their own legal problems and we often find that the stock terms offered by Persimmon do not go far enough to appease the current requirements of many lenders but that is why you are looking to instruct specialist solicitors. We try to amend the transfers to incorporate appropriate provisions to make this acceptable to your lender and any future lender.

What Other Costs Apply?

If you do decide to buy your freehold from Persimmon, your ground rent account must be fully paid up to date.

Persimmon will not charge you for the legal costs associated with the sale of the freehold but you must pay your own legal costs.

This is where we come in. We are specialists solicitors in property matters including enfranchisement (purchasing your freehold) and similar work including lease extensions. We deal with several hundred such matters a year. We are also already involved with other client’s purchasing their freeholds on this scheme.

We charge a flat fee of £850 plus for purchasing the freehold if you are mortgage free with an additional fee of £100 plus VAT for each mortgage you hold on the title.

Are there any limitations to the scheme?

If Persimmon have sold the freehold the above prices and conditions cannot be guaranteed. Persimmon say that “If we have already sold you a freehold of (what was) your leasehold house, we will endeavour (if you so require) to remove any permission fees for alterations and/or enforcement rights for rentcharges. If these require the consent or agreement of a third party we will rise reasonable endeavours to obtain that.”

How do I start the process with Persimmon

You need to complete the form on the Persimmon website below:


As this is a voluntary process there is no obligation on you to make an application, or to complete an application once it has been started.

How can I instruct your firm to assist me?

If you decide to progress with the purchase of your freehold from Persimmon then we can help you on the legal side. We have dealt with other matters with Persimmon using this scheme.

Please initially  contact Mark Sadler, Solicitor and Director on 01708 757575 or email mbs@ker.co.uk with your full names and your property address and we will email you out a pack and initial questionnaire.

If you need our details for Persimmon they are:

Solicitor’s Company Name: Kenneth Elliott + Rowe
Solicitor’s name: Mark Sadler
Solicitor’s Postal Address: Enterprise House 18 Eastern Road Romford Essex RM1 3PJ
Solicitor’s DX address: DX 131528 Romford 8
Solicitor’s email address: mbs@ker.co.uk
Solicitor’s Contact telephone number: 01708 707860
General Contact Number: 01708 757575

What happens next?

As soon as we receive your form it is always good to get the consent of your mortgage lender as this can slow the process if left to the end. We will deal with this first.

In the meantime we will contact Persimmon to obtain the paperwork and the draft documentation for approval.

We can then amend or approve the documents and arrange for you to sign in readiness for completion. Completion will only occur if all the documents are back signed by all parties (you and the Persimmon and any management company who is a party to the lease/new transfer).

Please note this process can take several months to complete (from experience).



Leave a Reply

Your email address will not be published. Required fields are marked *