Leasehold Service Charges

ukjon77

Hi

I'm a first time buyer in the process of buying a leasehold ground floor flat of a two storey/flat maisonette. The freeholder owns the flat upstairs and I will be buying the ground floor flat with a new 125yr lease.

My solicitor has raised a concern regarding the new lease as the new lease (differing from the old lease) says that I am 50% responsible for all maintenance, repairs, etc on the building as required. There is no set charge or limits and apparently it is quite unspecific as to what I may be obligated to pay for. There is a ground rent of £150pa and I think the freeholder only has to arrange insurance.

Is this usual or a cause for concern? I am worried that there is no limit as to what I may have to pay out for although I do appreciate that any charges have to be 'reasonable' and have to go through a process of notice, approval, etc.

I have not had a full structural survey done on the property as the valuer stated that they could not perform this due to being unable to have access to the upstairs property as it is separate. So could I be paying for roof repairs on a roof above someone else's flat, for example?

Any help, advice, guidance would be much appreciated as I'm still trying to get my head round this complicated business!

techno12

ukjon77 wrote: »

Hi

My solicitor has raised a concern regarding the new lease as the new lease (differing from the old lease) says that I am 50% responsible for all maintenance, repairs, etc on the building as required. There is no set charge or limits and apparently it is quite unspecific as to what I may be obligated to pay for. There is a ground rent of £150pa and I think the freeholder only has to arrange insurance.

Is this usual or a cause for concern? I am worried that there is no limit as to what I may have to pay out for although I do appreciate that any charges have to be 'reasonable' and have to go through a process of notice, approval, etc.

That's correct, I believe there's no upper limit. When I bought my place 2 years ago there were major works pending, and each of the 11 leaseholders had to fork out £5000 (new roof was required etc). Not good, but I knew about this before purchasing and had factored it in. Many maintenance charges siphon off some funds into a "sinking fund" to help cover these occasional major expenses - ours doesn't do that so we all had to bear the full pain at once

hambone

Please take heed of your solicitors concerns as it could prove very costly in the future!
I am leaseholder and also have an ambiguous lease which stated that I too was responsible for 50% of maintenance and repair, as well as 50% of the buildings insurance.
After a few years my freeholder sold the freehold to a very dodgy property developer who has been picking at the details of my lease and using it against me for years. My buildings insurance is extortionate (£1000 a year -and this is just my 50% apparently) and now he is building adjoining flats in the former garden and my solicitor has told me that my lease 'could' be interpreted in such a way that I have to pay 50% of the maintenance of these new buildings!!!

Now is the time to get the exact wording of your lease clarified....

sooz

Also, whilst it's true that your lease would be unable to state a max limit for maintenance (who knows what the price of a new roof would be in x years?), what does it say about a management fee? If indeed there is one?

I too have had the freeholder from hell, & a badly written lease. He decided one day to set up his own management company & employ them to 'manage' (in it's loosest sense). Up until then it had been free. Suddenly was £600 (and rising) per year each, BUT crucially he made up bills to show he never entered into a long term contract with 'them', so we were due no consultation.

I still want to do awful illegal things to the horrible little man......:mad:

However, yes it is normal for all leaseholders to pay towards all building repairs. If upstairs was only responsible for the roof, you'd be gutted if you had to pay for subsidence or damp proofing alone as the ground floor.

guppy

I wouldn't be happy with that lease.

The roof will need replacing at some point in the future, whereas people rarely get their foundations replaced!

Doozergirl

I'd check whether upstairs has a lease itself or whether the flat upstairs is actually freehold with your flat sold off on a lease.

Managing agents, as sure as death and taxes, will rip you off and make you pay over the odds for everything. At least when you're 50% responsible for maintenance on an ad hoc basis and there is no agent then the risk of being ripped off is reduced.

If upstairs is inextricably attached tot he freehold then you unlikely to ever get a profiteering freeholder, just someone else who's interest is in keeping the building maintained at sensible cost.

I had two flats that had leases like yours and I much preferred that to having to pay a managing agent for nothing. If you're grown up enough to own a house, you're grown up enough to look after it yourself, IMO.