Realistic Costs of Owning a 2 Bed Flat

Carpi09

KiKi wrote: »

I live in a 2 bed flat, have done for 8 years. My comments:

* Gas / elec may be a little low. I am on the lowest possible (I move suppliers regularly); I use hardly any gas, not that much electricity, and I'm on £53 a month.

* I pay £19 for water; I shower every other day, using the washing machine once a week max, wash up every other day. So that may give you an idea of your expected bill.

* Home contents is far too high, unless you have some crazily high value items! I pay approx £60-£70 for the year. Don't forget that you don't pay buildings insurance - that'll be included in your Maintenance (which I assume is included in your Ground Rent section)

* Ground Rent is very high. I assume that it includes Maintenance as well, but that's still very high. What's your lease liability (the percentage)? Will it be share of freehold?


No idea about car stuff - I don't have one!

HTH
KiKi

That's good to hear. I have raised Gas/Electric to £50 a month. Maybe I need to raise water to £30... haha


Yeah, I just noticed that with buildings insurance, thank you. Home contents & PPI now £20 a month.


Sorry what does lease liability mean? No share of freehold. I know they can raise ground rent in line with inflation.

Cornucopia

Carpi09 wrote: »

The only thing is, I may move in say 3-5 years time so don't want to be locked in for that long. I would like an offset product, haven't been able to find any. First Direct require high salary.

The products are always portable (though it's worth checking what that means with the specific lender).

There are other offsets available - have a look at one of the comparison sites. Well worth checking out, if you plan to carry a £10k contingency fund.

Carpi09

Cornucopia wrote: »

The products are always portable (though it's worth checking what that means with the specific lender).

There are other offsets available - have a look at one of the comparison sites. Well worth checking out, if you plan to carry a £10k contingency fund.

I've had a look at offset, they appear to be slightly higher in interest rates? Do they still work out better?


I understand you can access the money which is beneficial I suppose!

freeman3030

That's seems almost right, I live in a 2 bed flat and my figures are about the same as yours. I think the electric is a bit low as mine is about £80 per month (we have electric heating though) only think I would suggest is a contingency/savings fund in case you need a new car/repairs to your property... Other than that - spot on!

Carpi09

freeman3030 wrote: »

That's seems almost right, I live in a 2 bed flat and my figures are about the same as yours. I think the electric is a bit low as mine is about £80 per month (we have electric heating though) only think I would suggest is a contingency/savings fund in case you need a new car/repairs to your property... Other than that - spot on!

Thank you, my car is only 11 months old and is fully paid off. I have considered servicing and fuel costs in the table.


I have 10k contingency.


Appears Beverley Building Society do an offset working at 4.1 overall APR. This sounds good...

Michelle2014

Is your Shared ownership rent and service charges included? I have a 2 bed shared ownership flat - you should be prepared for rises to the rent every year depending on what your lease says. It feels like ours has gone up a lot over the past 8 years. Our electric/gas are higher around £100 a month and we never have the heating on (very warm flat). Our water rate is included as part of the service charge (water meter for the block of flats) so you might want to check that.

princeofpounds

Ground rent and service charge are not the same thing. Make sure you have an idea of both.

Ground rent is simply a payment you have to make for the right to use the land. Normally specified in the lease.

Service charge is a contribution to the management and upkeep of the communal areas and structures. It can vary significantly, especially if there are major works due, but having a sinking fund helps smooth the volatility. The lease will explain the basis of how it is charged, but it will be hard to get an exact figure.

nancmat

We are just moving out of our 2 bed flat in Dorset, we paid the following monthly:-
Water - £46
Gas & Electric £109
Council tax £120
Then annually we paid £250 ground rent & £150 maintenance but would then sometimes get a huge bill when the accounts were done, I'd never buy a leasehold property again. The freeholders & management company were terrible.

Carpi09

princeofpounds wrote: »

Ground rent and service charge are not the same thing. Make sure you have an idea of both.

Ground rent is simply a payment you have to make for the right to use the land. Normally specified in the lease.

Service charge is a contribution to the management and upkeep of the communal areas and structures. It can vary significantly, especially if there are major works due, but having a sinking fund helps smooth the volatility. The lease will explain the basis of how it is charged, but it will be hard to get an exact figure.

I think the Service Charge is classed as Maintenance, if this is the case, it is included I believe.


I know the rent is able to go up with inflation, think there is a cap at 3% per year?

Carpi09

nancmat wrote: »

We are just moving out of our 2 bed flat in Dorset, we paid the following monthly:-
Water - £46
Gas & Electric £109
Council tax £120
Then annually we paid £250 ground rent & £150 maintenance but would then sometimes get a huge bill when the accounts were done, I'd never buy a leasehold property again. The freeholders & management company were terrible.

Was this a converted house? The flat im looking at is in a block and only 2 years old, never been lived in. Who was the company?