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freehold flat
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what are the problems or potential problems with buying a freehold flat, and how wary should one be of them?
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Both of the above are true and not sure there's much more that I can offer.
The freehold element means that you own the land on which the structure is constructed. With flats, the 'ownership' is therefore more often separated so that one party owns the land (the freeholder) whilst each of the owners of the flats hold a lease to the structure alone. Various rules then define who is responsible for what maintenance (often the freeholder is responsible for the outside and the leaseholder is responsible for the inside). The freeholder gets the money to undertake repairs via the monthly payment. One part of that monthly payment essentially gives him/her money as ground rent for the structure sitting on the land.
If one flat owns the freehold, it will typically be the ground floor flat - the one actually sitting on the earth. Mortgage companies may be suscipious of them because the other (leased) flats get in the way of tidy ownership on which the mortgage company depends to assure its lending. Then there's the roof, and the question of who maintains it.
All of the above are reasons why freehold flats can be an problem and why the more usual arrangement is that the freehold is held by one organisation (and often the leaseholders own a stake each in this organisation) and the individual leases are held by the 'owners' of the individual flats.
The freehold element means that you own the land on which the structure is constructed. With flats, the 'ownership' is therefore more often separated so that one party owns the land (the freeholder) whilst each of the owners of the flats hold a lease to the structure alone. Various rules then define who is responsible for what maintenance (often the freeholder is responsible for the outside and the leaseholder is responsible for the inside). The freeholder gets the money to undertake repairs via the monthly payment. One part of that monthly payment essentially gives him/her money as ground rent for the structure sitting on the land.
If one flat owns the freehold, it will typically be the ground floor flat - the one actually sitting on the earth. Mortgage companies may be suscipious of them because the other (leased) flats get in the way of tidy ownership on which the mortgage company depends to assure its lending. Then there's the roof, and the question of who maintains it.
All of the above are reasons why freehold flats can be an problem and why the more usual arrangement is that the freehold is held by one organisation (and often the leaseholders own a stake each in this organisation) and the individual leases are held by the 'owners' of the individual flats.
my son owns a freehold flat, and we feel it's an advantage rather than a disadvantage. obviously with a leasehold one, there's an expiry date for the lease. this could cause problems if/when you try to sell and the lease has little time left on it - even a lease with say 50 years left on it isn't actually very much, and if you live there for maybe 25 years yourself, then there's only 25 years left on the lease when you come to sell. no-one in their right mind would buy a flat with only 25 years left on the lease!.
in my sons case, it's a management company who own the freehold. all the owners of the flats have equal shares in the management company and voting rights on matters like the maintenance charge, cleaning, gardening, etc. he has recently had a small leak in his roof (top floor flat) and it was dealt with through the management company at no extra cost. once a year they hire a skip for everyone to get rid of any unwanted rubbish, all the stairwells and communal areas are cleaned once a week, and the windows to all the flats are cleaned a couple of times a year. as a management company they have more clout with nuisance neighbours too.
he had no trouble at all getting a mortgage.
in my sons case, it's a management company who own the freehold. all the owners of the flats have equal shares in the management company and voting rights on matters like the maintenance charge, cleaning, gardening, etc. he has recently had a small leak in his roof (top floor flat) and it was dealt with through the management company at no extra cost. once a year they hire a skip for everyone to get rid of any unwanted rubbish, all the stairwells and communal areas are cleaned once a week, and the windows to all the flats are cleaned a couple of times a year. as a management company they have more clout with nuisance neighbours too.
he had no trouble at all getting a mortgage.
I own a freehold flat, which is actually a shared freehold. Its an old Bank. The lady upstairs has the top 2 floors and I have the ground and basement. So, we share the whole responsibility of upkeep. Basically, she looks after hers and I look after mine. If it floods, I deal with it. If the chimney falls off, she does. We do actually have a leasehold too, but we are each others' landlords! So the lease says about not painting the door weird colours etc. but it only means that her and I have to agree on such things. It is also listed so we can't do much to the exterior anyway. A freehold flat saves you money in maintenance and ground charges each month, but just like owning a house, it is all yours to look after and repair.
Geez - how many times do I have to say this?
A leasehold flat where the owner also owns a share of the freehold with the other leaseholders is NOT the same thing as a freehold flat (where there are other leaseholders involved but who don't know a share).
All three of you are quoting your own situations in which you own the leasehold plus a share in the freehold.
These are not generally a problem with mortgage lenders.
A leasehold flat where the owner also owns a share of the freehold with the other leaseholders is NOT the same thing as a freehold flat (where there are other leaseholders involved but who don't know a share).
All three of you are quoting your own situations in which you own the leasehold plus a share in the freehold.
These are not generally a problem with mortgage lenders.
i appreciate what you're saying buildersmate, but all the situations that have been described have some relevance, and chirpychirpy now has a lot more information about buying a freehold flat.
just as a point of interest, our sons flat was advertised as freehold, and as and when he comes to sell it, he will also advertise it as freehold. none of us know what kind of 'freehold' chirpychirpy is referring to do we?
just as a point of interest, our sons flat was advertised as freehold, and as and when he comes to sell it, he will also advertise it as freehold. none of us know what kind of 'freehold' chirpychirpy is referring to do we?
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