Share of Freehold division of costs between two flats

jawling

I’ve recently moved into a share of freehold converted flat having owned two freehold houses before. There are just two flats in the building although mine is smaller – one bed as opposed to a three bed maisonette, with a rebuild cost ratio of approximately one third to two thirds for the maisonette. There is nothing in my legal documentation to say that I have anything other than a half share in the freehold of the building.
I’ve been shocked by the prices quoted for buildings insurance on the property but have found one that is at least competitive and with a top-rated company, according to the latest Which? survey. I’m puzzled, though, as to how the premium payment should be divided between myself and the owner of the maisonette. Is there any convention on this? Is it simply half and half?

Is there, also, any accepted precedent on how much each party pays for repairs and redecorating of the building when one of a pair of flats in a converted building is a fair bit bigger than the other?

This all seems like a minefield, exacerbated by the fact that the owner of the maisonette is likely to be renting out, at least for a while. I can find nothing online that suggests a formula so am hoping for direction from someone(s) on this forum with more experience of these SOF situations than me. Many thanks.

Moonraker71

I'll be watching this thread keenly as I too am looking mostly at SOF flats where there are only two in the building (most of which have a loose "as and when" maintenance arrangement). Leasehold flats come with their own set of nightmares, and I'd rather purchase SOF overall, but it seems that SOF flats with just two parties involved could potentially be tricky if there is disagreement on how/when work needs to be done to the property. What if the windows are rotten/exterior needs painting but one party doesn't give a damn? This sort of scenario does put me off SOF a bit I have to say.

loubel

You need to start by checking your lease. This should tell you how maintenance charges are to be calculated.

jawling

Thanks Loubel. I’ve obviously checked my lease and my solicitor’s lease report. However, it’s now emerged that only my co-freeholder’s solicitor spotted that the upstairs flat had had a further floor added subsequent to the original lease. He referred to the possibility that a 50:50 ratio for costs may not be fair now in his lease report for my co-freeholder, ie the purchaser of the upstairs maisonette. My solicitor appears to have overlooked this, however, or may not have had access to the information at the time since my sale went through a few months earlier. I can find this out. Whatever, the outcome is that a 50:50 ratio for buildings insurance, maintenance and repairs stands now in law - clearly to my financial disadvantage.



I’m depressed about this as one major reason for downsizing to a flat was to reduce costs as I approach retirement.



Be vigilant, Moonraker71. . .

tim123456789

You may have a case for arguing that your solicitor was negligent in not noticing this.

It could be that when the owner of the lower flat (as joint freeholder) gave permission to the upper flat to extend into the common void he agreed to keep the 50-50 maintenance split in return for some consideration for "loss of value".

OTOH, it could be that the upper flat extended into the void without permission of the joint freeholder.

G_M

What doesthe lease actually say, if anything?

If an extension to one leasehold was agreed/undertaken, but the lease was not altered, then the original terms of the lease stand.

Was the extension agreed by both freeholders at the time? Were the leases altered?

Failing all the above, it will be a matter for negotiation.

propertyman

There is no such thing as share of freehold !!!!!!:eek::mad:

The responsibility for placing and payment, as well as apportionment, of insurance is set out in your leases.

That you both jointly own the freehold as well as individually a flat with a lease is not now or ever shall be SOF.

If the leases say that the FH insures then that is a matter you arrange jointly and divvy up as the lease states.

Make sure that you have the correct declared value for the insurance which has nothing to do with the purchase price or sale value of the flats.

There are only 3 types of tenure, freehold leasehold and commonhold SOF is just estate agents b*ll*cks.

G_M

propertyman wrote: »

There is no such thing as share of freehold !!!!!!:eek::mad:

Of course there is:

A freehold can be owned jointly by 2 or more people, often but not always also leaseholders, perhaps via a company in which they each/all have shares.

Yes, estate agents explain the specifics poorly, and often fail to explain that a buyer is actually buying two seperate entities:
* the lease on a flat and
* a share of the freehold on the building

But yes, you are right that it is the lease(s) which specify who pays what - hence my earlier post querying the terms of the lease.

propertyman

G_M wrote: »

Of course there is:.

No there isn't GM

There are are only three types of tenure commonhold leasehold and freehold.

If a freehold is owned by GM and PM, then the freeholder is GM and PM, they are one single legal entity, not a share.

Where the FH is owned by a company they are a member of or have share in, that company, not the freehold.

Perpetuating this idea makes people they have a tenure "SOF" which is misleading and counterproductive.

partialycloudy

We have just purchased our FH with the downstairs flat.
Ours is a two bed and his is a one bed and has the front garden. We both share the back garden.

Insurance was split 50/50
Repairs/maintance was always laid out in the lease as we are responsible for the roof as we are top floor and he is resposible for the foundations as he is groundfloor. Painting/maintance of outside should be done every 7years or so but do not think it states how the cost is to split. When the flats were LH we never did pay any maintance only ground rent.

If you wanted your windows replaced and the other flat didn't surely you would just replace your own windows and the other flat wouldn't?

We have just spent the weekend painting the front door and front of the house, we did this as we are currently trying to sell. The other Freeholder has offered to pay half towards the paint but has so far not handed over any money. But as we decided to do this for own benefit I am not to fussed if he pays or not.

We are quite lucky as both flats are owner occupied so could see it would be a trickier situation if the properies are rentals.

G_M

partialycloudy wrote: »

We have just purchased our FH with the downstairs flat.
Ours is a two bed and his is a one bed and has the front garden. We both share the back garden.

Insurance was split 50/50
Repairs/maintance was always laid out in the lease as we are responsible for the roof as we are top floor and he is resposible for the foundations as he is groundfloor. Painting/maintance of outside should be done every 7years or so but do not think it states how the cost is to split. When the flats were LH we never did pay any maintance only ground rent.

If you wanted your windows replaced and the other flat didn't surely you would just replace your own windows and the other flat wouldn't?

We have just spent the weekend painting the front door and front of the house, we did this as we are currently trying to sell. The other Freeholder has offered to pay half towards the paint but has so far not handed over any money. But as we decided to do this for own benefit I am not to fussed if he pays or not.

We are quite lucky as both flats are owner occupied so could see it would be a trickier situation if the properies are rentals.

This does not really help the OP. Your own circumstrances/lease etc may (probobly are) completely different.

Yes, in some cases (esp where only 2 flats) an 'amicable arrangement' can be reached without reference to the lease/the law, but where negotiation fails, the lease needs to be referred to.