The 4 Hidden Problems with Share of Freehold

Most people who buy a share of freehold do so believing the hard part is over. They’ve escaped the external freeholder. They’re no longer paying ground rent into someone else’s pocket. They have a say in how their building is run. On paper, it looks like the best version of flat ownership available in England and Wales.

In practice, the problems with share of freehold don’t disappear when you acquire it — they change shape. Instead of being subject to a distant freeholder’s decisions, you are now jointly responsible for making those decisions yourself, alongside co-owners who may have different priorities, different levels of engagement, and different tolerances for cost and disruption. The legal and financial obligations that come with freehold ownership don’t come with a manual. And when things go wrong (a development threat, a depleted sinking fund, a dispute that deadlocks) the consequences fall on the flat owners themselves.

At The Freehold Collective, we have guided over 600 leaseholders through freehold acquisitions across the UK in the last 12 years. The same four hidden problems appear time and again, in buildings of every size and value; from a 12-flat luxury property in Guildford to a 34-unit mansion block opposite Kensington Gardens. This article sets out what those problems actually look like in practice, and what separates the acquisitions that go smoothly from the ones that don’t.

Understanding Problems with Share of Freehold

While a share of freehold offers increased control and financial autonomy for flat or apartment owners, it also introduces a unique set of challenges. Without effective project management, these issues can quickly escalate, threatening the smooth running, legal compliance, and value of your property.

Key reasons why effective project management for your collective freehold purchase is essential:

• Coordination Difficulties: With multiple co-owners, getting agreement on repairs, improvements, or major decisions can create delays and friction.
• Financial Risk: Unexpected major repairs or legal claims can result in significant costs if not managed proactively.
• Legal and Compliance Challenges: Staying up-to-date with health & safety, fire regulations, and property law is complex and essential to avoid fines or legal claims.
• Maintenance Backlogs: Poor organisation may lead to essential maintenance being overlooked, turning small issues into costly disasters.
• Disputes and Relationship Strain: Decision-making deadlock and communication failures are not just frustrating—they can stall vital works or even result in litigation.

Skilled project management brings together expertise in law, finance, building management, and communication, ensuring your building stays safe, compliant, and valuable.

At The Freehold Collective, we have guided over 600 leaseholders through these exact challenges in just 12 years. Time and again, we see the same four hidden problems surface — whether a building has two flats or twenty-four — and in every case, the outcome depends on whether leaseholders have experienced project management on their side. The cases below are drawn directly from our work.

Key Problems with Buying a Share of Freehold

Shared Management

A share of a freehold is not the same as buying a freehold house. When you purchase a freehold house, you have the complete right to control everything that happened to your property. You get to make all decisions with regards to what gets done or not done. When you only own a share of a freehold, decisions are made between yourself and the other share of freehold owners.

This means it can be possible for your co-owners (shareholders) to make decisions that affect your property. However, if you did not own a share of the freehold you would be in a worse situation, where you would receive no input into decisions that affect the property.

This makes shared management a minor problem with the share of freehold. Other freeholders will still potentially be able to make decisions that you may disagree with (if a majority vote is cast), but it is important to remember without a share at all there would be no opportunity for discussion in the first place. Because of the complexity of this and other issues, we recommend getting expert advice on buying a Freehold.

🔍 Case in Point: Garden Lodge Court, East Finchley — Neighbours Who Did Not Know Each OtherAt Garden Lodge Court, a residential block of 1 and 2-bed apartments in North London, the leaseholders barely knew one another. There was active discontent between residents and the managing agent, creating an atmosphere of distrust. A mutual contact told us a collective freehold purchase was “impossible”.In parallel, a Section 5b notice was served by the freeholder, meaning the building was heading to auction — adding urgent time pressure. Within weeks of TFC becoming involved, we had galvanised 10 of the 12 flat owners into a collective enfranchisement group through regular communications, individual conversations, and one-to-one focus work. We reserved the leaseholders’ right of first refusal, preventing a developer — who was actively interested in the property — from outbidding them at auction.Once the freehold was secured, we discovered that several leases across the block contained errors and were in different forms. Left uncorrected, these would have created legal and mortgage complications for every flat owner. We standardised and updated all leases to CML-compliant terms — protecting property values across the block.

Lack of Expertise

It’s vital that all freeholders have, or have appointed a representative that has, a good understanding of Landlord and Tenant laws to ensure that building maintenance and upkeep responsibilities, as well as health and safety legislations are being met. Lack of expertise in these areas could lead to building deterioration, alongside unhappy or vulnerable residents living in potentially dangerous environments.

Failure to comply with legislation could also lead to criminal prosecution, amongst fines or even imprisonment, which is why we always advise that you seek expert advice before purchasing a share of the freehold.

However, employing a managing agent will save you many headaches in this area – all good managing agents keep up to date with Landlord and Tenant laws, and any other building regulations you may need to follow.

🔍 Case in Point: Langton Priory, Guildford — A Solicitor Who Did Not Know How to Serve a NoticeThe consequences of a knowledge gap in property law can be severe. At Langton Priory, once the freehold was being acquired, it emerged that the solicitors acting for the administrators (the former freeholder had gone insolvent) did not know how to correctly serve the required legal notice on the leaseholders. Incorrectly serving this notice is not just a procedural error — it is a criminal offence.The Freehold Collective stepped in to guide the solicitors through the correct process, teaching them how the notice should be served. Had this gone wrong, it could have derailed the entire acquisition and exposed all parties to serious legal liability.This is why we act not just as coordinators but as project managers with deep expertise in property law. Leaseholders should not have to rely on hope that every professional in their chain is across the finer points of legislation. We are.

Problems With Development

Problems with development can include things like: insufficient foundations, incorrect or substandard materials, poor drainage systems etc. In the majority of cases these problems will only come to light when you have a problem with your property, such as water penetration, so this is why it’s important to be aware of what can go wrong.

🔍 Case in Point: Bridge Court, Taplow — A Developer in the Wings and a Premium 200 Times What Leaseholders ExpectedBridge Court is a 24-flat residential building beside the River Thames in Taplow, Buckinghamshire. When TFC founder Mike Somekh first met with leaseholders here — in a local pub, with 35 people turning up despite expectations of very few — the building’s freeholder was already mid-way through a Section 5 notice process to sell the freehold. Leaseholders had only three to four weeks left to respond, having already lost time.The freeholder was claiming development value on the freehold premium because the building sat on deregulated greenbelt land. In the worst case, the premium was estimated at over 200 times what leaseholders were willing to pay. A developer was actively waiting: had the freehold been sold openly, the new owner could have built on the large garden bordering the Thames, causing significant devaluation to all flats and opening the door to dramatically increased service charges and building insurance from the incoming managing agent.By working closely with a trusted valuer — assembled from contacts built during TFC’s own freehold acquisition at Barrie House — TFC made a comprehensive case against the development value claim. The argument drew on planning law analysis, nearby environmental research, local comparables, and flood reports. Combined with the leaseholders’ stated readiness to pursue the matter at Tribunal, this persuaded the freeholder to reduce the accepted premium to a fraction of the original claim, with no overage restrictions attached. Leaseholders secured their freehold, took control of service charges and building insurance, and saw their flat values rise as a result.

Building Defects

The final consideration is the one we see most often, hidden building defects. These problems will typically show up quickly after moving in. They can include: cracks in the walls/floors (or even above windows and doors), broken tiles, broken glass, faulty drainage systems etc and could leave you liable for finding thousands of pounds worth of repair costs. In order to avoid exposure to these hidden problems you should consider purchasing a share in a freehold property with a warranty, or employing expert advice before buying a share in a freehold.

With both development problems and other building defects, leaseholders would end up paying anyway, through their service charge, so why not buy your freehold and be in control of how your money is spent?

🔍 Case in Point: Lancaster Court — A Severely Neglected Building and a Sinking Fund That Had DisappearedThe building defect problem is often made worse, not better, by inadequate management of the sinking fund. At Lancaster Court, by the time the Right to Manage company took over the finances, a reserve fund of £500,000 had been collected over the years — yet £300,000 of that had been spent with no clear record of where it went. Worse, the building itself had been severely neglected in the interim.With the reserve fund depleted and disputed, the Right to Manage group faced the double burden of repaying what the freeholder demanded and then recollecting fresh funds to address a maintenance backlog that had been allowed to accumulate. Without proper financial oversight from an experienced project manager — someone who routinely scrutinises accounts, monitors sinking fund contributions, and holds contractors to account — these situations develop silently until the cost of intervention is enormous.A professional project manager for your share of freehold doesn’t just coordinate decisions. They protect the financial health of your building, ensuring that sinking fund contributions are appropriate, that spending is transparent, and that building maintenance does not get quietly deferred until it becomes a crisis.

What are the Benefits of Buying a Freehold?

You may be weighing up whether or not to form a collective with the other leaseholders in your block. Though it might appear an overwhelming process if done properly it is not and there are many benefits to buying your freehold outright, including:

• Increasing the value of your property
• Full oversight of the quality of works and maintenance done to the building
• Taking full control of the management
• No ground rent or other hidden costs
• The ability to take out insurance plans which are more comprehensive or affordable

Though a freehold purchase will reap some or all of these benefits, owning a share of a freehold comes with some considerations.

Need to buy out your freehold? You Might Like: Why Should I Buy My Freehold?

Why Managing Your Own Collective Enfranchisement Can Be Challenging

Taking on the management of your own collective enfranchisement may look appealing, but in practice, self-management often intensifies the issues found with share of freehold:

• Increased Administrative Burden: Organising meetings, minute-taking, collecting fees, managing accounts, and chasing late payments can become overwhelming for owners who already have their own commitments.
• Lack of Professional Expertise: Few leaseholders have specialist knowledge in property law, finance, or building maintenance, raising the risk of accidental non-compliance and costly mistakes.
• Impartiality and Dispute Resolution: Personal interests can conflict, and without a neutral party, disputes between owners are harder to resolve swiftly.
• Time Constraints: Effective building management is time-consuming, meaning delays to repairs and decisions are common when all work is volunteer-based.

A professional project manager or managing agent alleviates these issues, bringing expertise, impartiality, and procedural rigour. They keep legal and financial obligations on track, plan repairs, forecast budgets, resolve disputes, and enable leaseholders to make the most of their share of freehold without constant hassle or risk.

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Issue/Task	Self-Management by Leaseholders	Professional Project Manager/Agent
Legal Compliance & Regulations	High risk of accidental breaches	Regularly updated on current law; mitigates risk
Financial Planning & Budgeting	Inexperienced; may under/over budget	Expert forecasting, efficient fee collection
Maintenance Coordination	Prone to delays/disagreements	Planned schedules and prompt delivery
Dispute Resolution	Conflicts can escalate or deadlock	Neutral party mediates disputes swiftly
Administrative Burden	Time-consuming and stressful	Managed externally, freeing leaseholder time
Communication	Can be inconsistent	Structured, regular updates and meetings
Cost Efficiency	May miss savings/overpay contractors	Leverages networks for better deals and accountability

What are the Responsibilities of a Freehold Shareholder?

Freehold owners, or the collective freehold shareholders, are responsible for the maintenance of the building and its land, as well as ensuring its smooth function. This includes key responsibilities such as ensuring things like communal lifts, stairways and halls meet industry health and safety regulations, carrying out repairs, and keeping up with ever changing property legislation. They can decide on the budget and what works are done and how they are prioritised. However, many buildings (or collectives) employ a managing agent to take care of this for them.

Looking For Support To Purchase Your Freehold?

If you’re thinking about purchasing a share of a freehold but are worried about the potential hidden share of freehold problems, we can help. At the Freehold Collective, we help leaseholders buy their freeholds. We consult with leaseholders at any stage of their freehold journey, and offer a wealth of industry expertise developed over years of freehold purchases.

The cases above are not outliers — they represent the kind of challenges The Freehold Collective encounters regularly, and resolves as a matter of course. Over 12 years, we have helped more than 600 leaseholders take control of their buildings across the UK. Our role is not just to facilitate a purchase; it is to act as a dedicated project manager at every stage: from organising leaseholders who have never spoken to one another, to navigating inflated freehold premiums, resolving disputes before they reach tribunal, and supporting new freeholders through the ownership phase once the acquisition is complete.

Whether you are facing a freehold nightmare with your current management, concerned about a development threat, or simply want to understand your options, our free initial consultation gives you a review of your Land Registry information, a frank conversation about the specific problems you face, and clear advice on the best path forward. Find out who we help or book your free consultation today.

Unsure about costs? We have created a stress-free Freehold Calculator to help you understand the investment involved.

Share of Freehold Problems FAQs

What are the biggest share of freehold problems for co owners?

Key share of freehold problems include disagreements over building maintenance, property management, financial contributions, and service charges. Without clear managing agents, disputes can lead to freehold nightmares for collective freehold shareholders. Leasehold property owners in share of freehold properties sometimes face a freehold dispute when standards or contributions are misunderstood.

As the cases of Lancaster Court and Langton Priory show, these freehold problems are not hypothetical. Missing reserve funds, lease errors, personality clashes, and development threats are real risks. The common thread in each resolved case was the presence of an experienced project manager who could navigate the legal, financial, and human dimensions simultaneously.

How are potential disputes resolved between flat or apartment leaseholders?

Potential disputes over ground rent or budgets among co owners are first handled between share of freehold owners or via a managing agent. If unresolved, issues may escalate to the tier tribunal property chamber for official dispute resolution.

Can a project manager help prevent share of freehold nightmares?

Yes. A project manager to facilitate the smooth running of the collective purchase process can significantly improve the future of your building’s property management, legal compliance, and dispute resolution, helping prevent share of freehold nightmares by setting up the foundation effectively.

At The Freehold Collective, we have resolved situations where freehold problems had been building for decades — including a Central London mansion block where leaseholders had been unable to form a collective for twenty years, and a Guildford property where an attempted acquisition had already collapsed once. In both cases, structured project management turned a stalled situation into a successful outcome.

What responsibilities do collective freehold shareholders have in a freehold flat or share of freehold ownership?

Co owners must handle building maintenance, ensure legal compliance, manage ground rent, and agree on service charges. Open communication with other freeholders and clear processes help avoid freehold problems and disputes in freehold properties.

Is it worth buying a share of the freehold?

In the vast majority of cases, yes — provided you approach it with the right support. A share of freehold gives flat owners greater control over their building, eliminates ground rent, typically increases property values, and removes reliance on an external freeholder whose interests may not align with yours. The key is to go in with a clear structure, professional guidance, and a realistic understanding of the shared responsibilities involved. Our cases — from a 24-flat riverside building in Buckinghamshire to a high net worth mansion block in Kensington — demonstrate that with the right project management, even the most complex acquisitions deliver lasting benefits for every leaseholder involved.

Are share of freehold flats hard to sell?

Share of freehold flats are generally easier to sell than standard leasehold flats, particularly if the lease is long and the freehold company is well-managed. Mortgage lenders are familiar with share of freehold arrangements and most will lend without issue, provided the freehold company has proper governance. Problems arise when leases contain errors, when there are unresolved disputes between co-owners, or when the freehold company has failed to maintain proper accounts — all issues that professional project management prevents from arising in the first place.