Leasehold or Share of Freehold?

[mrpoll]

I am in the process of buying a flat. It was advertised as leasehold but I met the vendor who told me that the residents of the building had formed a company and were in the process of buying the freehold. The vendor told me that the asking price took this into account, as he has already contributed his share to the transaction.

The building is 6 years old, so there is unlikely to be a problem with the length of the lease. The reason the residents are buying the freehold appears to be that the company owning the freehold went into liquidation in 2007. The Official Receiver and the one secured lender, a building society, are being very slow in deciding whether to permit the transfer of the property. It is possible that it will never happen.

My solicitors don't seem to be terribly useful in advising me on the situation. I need to know:

- Should I go ahead and buy the leasehold (what are the risks of buying a lease with a freeholder in liquidation?) ?

- If so, should I reduce my offer to account for this? By how much?

- Or could I purchase the leasehold for the same price but insist that the share in the freehold company be transferred to me as well? Wouldn't this mean that if the transaction never went through, the current vendor's contribution would be refunded to me?

Any help would be much appreciated. Thanks.