We’d like to remind Forumites to please avoid political debate on the Forum.

This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

PLEASE READ BEFORE POSTING: Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Groundrent??

I live in a converted mill of 97 flats, each year we pay a service charge to maintain the building etc..Fair enough.

What I can't get my head round is that we each own 1/97th of the freehold each, but the management company have just sent me a bill for £50 yearly ground rent. So does this mean we are paying 'rent' to ourselves?

The lease does say we must pay the charge, but that was drafted when the freeholder was a third party, surely this should be disolved now we own the freehold.


I know it's only £50, it's just doesn't seem right?:confused:

Comments

  • Jake'sGran
    Jake'sGran Posts: 3,269 Forumite
    Fitzy29 wrote:
    I live in a converted mill of 97 flats, each year we pay a service charge to maintain the building etc..Fair enough.

    What I can't get my head round is that we each own 1/97th of the freehold each, but the management company have just sent me a bill for £50 yearly ground rent. So does this mean we are paying 'rent' to ourselves?

    The lease does say we must pay the charge, but that was drafted when the freeholder was a third party, surely this should be disolved now we own the freehold.


    I know it's only £50, it's just doesn't seem right?:confused:

    Looks like you are right if you are really sure that when you bought it the papers definately said you would own one 97th of the freehold. There have been some fishy dealings with regard to leaseholds/freeholds so I think I would seek advice on this one. We live in a semi with three beds and the leasehold is £12. Also, have a look on line to see what you can find on the subject and write (don't phone) the company who have sent the bill to ask what you are asking here, i.e. how can they charge a leasehold fee when you already own your part of it.
  • pboae
    pboae Posts: 2,719 Forumite
    1,000 Posts Combo Breaker
    Even though you own a share of the freehold, you are still a leaseholder. The 2 things are seperate and you just happen to own both of them (or at least a part of one and all of the other!). So yes, you are paying rent to yourself.

    Owning a SoF gives you much greater control over how the block is managed, but you are still a leaseholder too. It may also be that not all the flats in the block do own a SoF, some may still be purely leasehold, and depending on how your SoF contract is written it could even be possible for you to sell your flat and retain your SoF (unlikely in such a large block though).

    You should be able to find out where the ground rent is going though, does the block have a sink fund of some description? Or it may just be off set against the management company's fees. By all means write to them and ask them about it, but it's not particularly unusual to still be paying ground rent.
    When I had my loft converted back into a loft, the neighbours came around and scoffed, and called me retro.
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 352.1K Banking & Borrowing
  • 253.5K Reduce Debt & Boost Income
  • 454.2K Spending & Discounts
  • 245.1K Work, Benefits & Business
  • 600.7K Mortgages, Homes & Bills
  • 177.4K Life & Family
  • 258.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.2K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.