Flying Freehold Mortgage: When Part of Your Home Is Over Someone Else's

A flying freehold is one of those property quirks that most people have never heard of until a surveyor mentions it and suddenly their mortgage application gets complicated. It is more common than you might think, particularly in older terraced streets and town centre properties — and it does not have to be a deal-breaker if you understand what lenders are looking for.

What Is a Flying Freehold?

In standard property ownership, your freehold sits on the ground. The land beneath your house belongs to you, the walls are on your land, and everything is neatly contained within your boundary.

A flying freehold occurs when part of your freehold property extends over or under a neighbouring freehold property. The "flying" part is the section that is not directly above your own land — it is above (or occasionally below) someone else's.

Typical Examples

• A room above a passageway: In many Victorian terraces, there is a shared passage between two houses at ground level, with a room from one house extending over it at first floor level. The room "flies" over the passageway.
• Overhanging upper floors: In some older properties, particularly medieval or Tudor buildings in town centres, the upper floors project out beyond the ground floor walls, extending over a neighbour's land.
• Rooms above a neighbour's extension: Where one property has been extended and a neighbouring property has a room that sits above part of that extension.
• Interconnected properties: In some conversions and subdivisions, parts of one property end up above or below parts of another.
• Properties spanning an alleyway or lane: Where a building bridges a gap between two sections of land.

Flying freeholds are most commonly found in:

• Victorian and Edwardian terraced houses
• Older town centre properties
• Properties in areas with medieval street layouts
• Houses that have been subdivided or altered over many decades

Why Lenders Are Cautious

The concern is essentially the same as with freehold flats — the enforceability of obligations between freeholders.

The Maintenance Problem

If your bedroom is above your neighbour's kitchen, and the floor/ceiling between them needs repair, who pays? If you own the room above, you have a clear interest in the repair being done. But your neighbour — whose kitchen ceiling is the underside of your floor — also has a stake.

In a leasehold arrangement, the lease would specify who is responsible. In a freehold arrangement, positive covenants (obligations to do things, like contribute to maintenance) generally do not bind future owners of freehold land. This means even if you and your current neighbour agree to share costs, the next owner of their property may not be bound by that agreement.

The Access Problem

If part of your property is above your neighbour's, you may need access through their property to maintain or repair the flying freehold section. Without a legally enforceable right of access, you could find yourself unable to maintain part of your own home.

The Structural Interdependence

The flying freehold section depends on the structure below it for support. If the neighbouring property is damaged, demolished, or falls into disrepair, the flying freehold section could be compromised. Lenders want to be confident that their security (your property) will remain structurally sound regardless of what your neighbour does.

How Much of the Property Is "Flying"?

This is one of the most important factors for lenders. A small flying freehold — say a single room above a passageway, making up 10% of the property's total floor area — is viewed very differently from a large flying freehold where half the property extends over a neighbour.

General Lender Thresholds

• Less than 10% of the property: Most mainstream lenders will consider this with indemnity insurance in place
• 10-25% of the property: Some mainstream lenders will consider it; building societies and specialist lenders are more likely to help
• 25-50% of the property: Difficult with mainstream lenders; specialist lenders may help
• More than 50%: Very few lenders will consider this

These are rough guidelines — each lender has its own criteria, and the specific circumstances matter. A well-documented flying freehold with proper indemnity insurance and clear maintenance arrangements is more acceptable than one with no documentation at all.

Indemnity Insurance

Indemnity insurance for a flying freehold is designed to protect the lender (and you) against the financial consequences of the flying freehold causing problems — specifically, the risk that maintenance obligations cannot be enforced against a neighbouring freeholder.

What It Covers

A typical flying freehold indemnity policy covers:

• The cost of enforcing or defending rights related to the flying freehold
• Loss in property value if a flying freehold issue cannot be resolved
• The cost of alternative accommodation if the property becomes uninhabitable due to a flying freehold dispute

Cost and Availability

Flying freehold indemnity insurance is a one-off payment, not an annual premium. It typically costs between £50 and £300 depending on the property value and the extent of the flying freehold. The policy remains in force indefinitely and passes to future owners.

Most conveyancing solicitors can arrange this insurance as part of the purchase process. It is usually required by the lender as a condition of the mortgage offer.

Which Lenders Accept Flying Freeholds?

Generally Willing (with conditions)

• Halifax — typically accepts flying freeholds up to a certain percentage of the property
• Nationwide — will consider depending on the extent and circumstances
• Santander — may accept with indemnity insurance
• Many building societies — particularly those operating in areas where flying freeholds are common
• Some specialist lenders — flexible on non-standard property features

Common Conditions

Lenders that accept flying freeholds usually require:

1. Indemnity insurance — this is almost always mandatory
2. A satisfactory valuation — the surveyor must be comfortable that the flying freehold does not materially affect the property's value or saleability
3. The flying freehold to be a minor part of the property — the exact threshold varies by lender
4. Legal documentation — any existing agreements between freeholders should be provided

Valuation Impact

A flying freehold does affect valuation, but the impact varies:

• Small flying freeholds (under 10%): Minimal impact, typically 0-5% reduction
• Medium flying freeholds (10-25%): Moderate impact, perhaps 5-10% reduction
• Large flying freeholds (over 25%): Significant impact, potentially 10-20% or more

The surveyor will consider the extent of the flying freehold, the condition of both properties, the existence of any agreements between the owners, and the general marketability of the property.

Practical Advice

If You Are Buying

1. Find out the extent — ask the estate agent and your solicitor to clarify exactly what part of the property is a flying freehold and what percentage of the total floor area it represents
2. Check for existing agreements — are there any deeds of covenant, maintenance agreements, or rights of access in place between the freeholders?
3. Get indemnity insurance — your solicitor should arrange this as standard
4. Use a broker who understands non-standard properties — they will know which lenders to approach based on the specific circumstances
5. Commission a full building survey — a basic valuation will not give you enough information about the structural relationship between the two properties

If You Own a Property with a Flying Freehold

1. Maintain the relationship with your neighbour — practical cooperation is your best protection, whatever the legal position
2. Consider formalising arrangements — a solicitor can draft agreements about maintenance, access, and cost-sharing. While these may not be fully enforceable against future owners, they are better than nothing
3. Keep records of any maintenance work done on the flying freehold section
4. When selling, be upfront — disclose the flying freehold early and have your documentation ready. Trying to hide it will only cause problems later when the buyer's surveyor or solicitor identifies it

The Legal Position

The Law Commission has repeatedly recommended reforms to make positive covenants enforceable between freeholders, which would largely resolve the flying freehold problem. The Leasehold and Freehold Reform Act 2024 touches on related issues but does not fully solve the positive covenant problem for flying freeholds.

Until comprehensive reform happens, flying freeholds will remain a mortgage complication. But "complication" is the right word — not "impossibility." With the right lender, proper indemnity insurance, and good legal documentation, most flying freeholds are mortgageable.

The properties that cause the most difficulty are those with large flying freeholds, no legal documentation, and no indemnity insurance. If you are in that situation, investing in getting the right paperwork and insurance in place before approaching lenders will significantly improve your chances.

This is educational content, not financial advice. Your situation is unique — speak to a qualified mortgage broker before making any decisions.