Flying freeholds are rare, but they can create problems and many mortgage lenders have limitations or restrictions on lending on properties with a flying freehold element.

To understand what is a “flying freehold” you need to understand that normally a freehold includes all the land below and all the air above a property – from hell to heaven. Therefore two freeholds will not normally overlap. When this happens this invariably creates a ‘flying freehold’.

The normal solution when one property sits above another (eg a block of flats) is to have long leasehold interests, with the leases setting out the repair maintenance and insurance obligations.

With flying freeholds, however, it is rare for there to be original documentation dealing with those issues. Accordingly, the way to resolve the difficulties of a flying freehold is to:

• convert to a leasehold structure: this will involve both parts of the flying freehold being transferred into single ownership (e.g. a company owned by the property owners), with long leases then being granted with covenants that would automatically be binding on future assignees of the leases; or
• enter into a deed of mutual easements and covenants: this is the usual solution, with the parties entering into deeds which grant the necessary rights to each other, and contain appropriate covenants. However ‘positive obligations’ on freehold titles (eg an obligation of repair or pay out money) will not automatically bind successors in title. It follows for this arrangement to work long term, there must be an obligation to obtain a deed of covenant from any future buyer in favour of the other owner to observe and perform the obligations in the deed. This can be enforced by a restriction on each of the neighbouring titles to ensure that no sale can be registered without the consent of the other freehold owner (which will be given if the deed of covenant has been provided); or
• obtain indemnity insurance. But, do remember that such policies can often exclude cover for structural alterations or a change of use (which therefore effectively prevents any redevelopment or substantial improvements, whereas provision for redevelopment or change of use can be included in a lease or easement deed).

If you are purchasing a property which has a flying freehold contact us for further information.

For free quotes or further help and assistance moving home and residential property matters please contact Mark Sadler 01708 757575 or email mbs@ker.co.uk

Our specialist solicitors and lawyers assist clients with conveyancing in Romford, Upminster Hornchurch, Rainham, Harold Wood, Gidea Park, Harold Hill, Barking and Dagenham, Chadwell Heath, London and Essex (including Brentwood, Basildon, Grays, Thurrock, Shenfield, Chelmsford and Southend). We offer a fixed price conveyancing service.