What is a Leasehold property
When you purchase a leasehold flat/apartment, you are buying ownership of the property for a fixed amount of time. You do not own the land upon which the building is built.
Not every lease is the same, how long is left on the lease.
Once a lease has less than 80 years remaining, it becomes very costly to extend it. For guidance on how to extend a lease click here.
If your dream flat/apartment has a lease of under 80 years, you would definitely need to extend it. Seek legal advice before you enter into any form of agreement and use caution when purchasing a Leasehold property with 80 years or less left on the lease.
Once a lease is signed, it outlines the obligations of both the Leaseholder and the Freeholder. Both parties should pay notice to the contents of the Lease.
What a leaseholder is responsible for
The Leaseholder is responsible for the maintenance of everything within the four walls of the property. This includes:
- Living room
A Leaseholder will normally pay the Freeholder a monthly service charge that may fluctuate each year. This includes:
- Ground rent.
- Costs associated with keeping the building and grounds in good repair.
- Paying into a reserve account or “sinking fund” to cover major repairs.
What a Freeholder is responsible for
The building and the land is owned by and is the responsibility of the Freeholder. The Freeholder is responsible for:
- Providing each Leaseholder with a copy of the Buildings Insurance Policy.
- Maintaining and repairing the building structure.
- Keeping the hallways, staircases and internal and external communal areas in good repair.
Most Freeholders do manage the building well, however, at times this does not happen. Service charges at times can be unnecessarily expensive or a Leaseholder may feel that the Freeholder is not repairing the building when problems arise. If this is the case, there are options.
How to raise an issue with a Freeholder
If a Leaseholder has concerns about any part of the building he/she can do the following.
- Write to the Freeholder or the Managing Agent under Section 21 of the Landlord and Tenant Act 1985 requesting a breakdown of what has been spent on the upkeep of the building and grounds. The Freeholder or the Managing Agent must provide this information to the Leaseholder within one month of the request.
- If the report does not include the concerns raised, a Leaseholder can write to the Freeholder or the Managing Agent expressing concerns. The Leaseholder can keep a copy of all correspondence and only accept written responses.
- If the concerns are being ignored, a Leaseholder can raise a dispute using form: Service charges and leasehold management by way of a Leasehold Valuation Tribunal. For free help and guidance with this contact the Leasehold Advisory Service.