Freehold blocks
A multi-unit freehold block — an MUFB — is several self-contained flats or units held on a single freehold title. You buy the whole building in one transaction instead of assembling the same number of units one purchase at a time.
This is the route for an investor deploying larger capital who does not want to spend two years buying houses one at a time. One building, one set of solicitors, one refurbishment programme, one handover. The scale is the point.
The market quirk that makes blocks interesting is that a freehold block is valued differently from the flats inside it. A lender values a whole block on its rent and yield; individual flats are valued against what similar flats sell for locally. Blocks therefore tend to trade at a discount to the sum of their parts — commonly in the region of 10 to 15%, and sometimes wider on larger buildings.
That gap is also the exit. A block can be title split: the freehold stays with one entity and a long lease, usually 999 years at a peppercorn ground rent, is granted over each unit and registered at HM Land Registry. Each one then has its own title that can be mortgaged or sold separately. It is a real legal process with real cost — budget roughly £1,000 to £2,500 plus VAT per unit in legal fees, plus Land Registry fees and a split-basis valuation — and it is not right for every building. We will tell you honestly whether a particular block is worth splitting or better left whole.
Where the units suit it, a block can also go on a provider lease, which turns a multi-unit building into a single monthly payment with nothing to manage. Not every provider will take a whole building and some cap how many units they will take in one place, so it is a question we settle early rather than assume.
Being straight with you: good blocks do not come up every week. We will keep you on the list and tell you when one appears rather than talk you into a mediocre building because you asked for one.
On funding a block. Lending here is specialist rather than mainstream. Some lenders will size a facility against the aggregate value of the individual units rather than the lower freehold block figure, which changes the deposit picture considerably. Terms move and depend heavily on your experience and the building, so treat anything you read as a starting point and speak to a broker who does these regularly. We can introduce one.
Where it works
- One transaction and one legal process instead of several
- Freehold blocks typically trade below the combined value of the units inside them
- You own the freehold outright — no third-party service charges or ground rent
- One empty unit does not stop the building earning
- One insurance policy, one agent, one roof to maintain
- Can often be leased whole to a provider, or title split later
The trade-offs
- A considerably larger cheque than a single house
- Fewer lenders will touch them, and rates sit above standard buy-to-let
- Everything is in one building — one fire, one roof, one bad street
- More intensive management unless the whole block goes on a lease
- Harder to sell as a block than as individual units, unless you split first
- Good ones are genuinely infrequent — this is not constant stock
Is freehold blocks right for you?
Tell us your budget and how involved you want to be, and we'll tell you straight which of the three routes fits.