Major repair cost bill on leasehold flat - who pays? Buyer or seller?

gatsbyNZ

Hi
Going through the documents and will seek legal advice. But as a 1st time buyer keen to hear your opinion. A large freeholder has decided to repair their housing stock. The work has been completed, but the bill has not been sent (due to it being a large slow organisation). Estimated bill £7k. Questions is who should pay? I could argue they should reduce the agreed price by £7k, but then we don't have a spare £7k lying around to pair for the repairs. Teh realestate agent never mentioned any outstanding bills and this has come up with our solicitor doing their job. As far was we were aware we were buying a leasehold flat in really good external condition and so our offer reflected this. Have not spoken to our solicitor yet as only received the documents today. What are your thoughts?

vuvuzela

gatsbyNZ wrote: »

Hi
Going through the documents and will seek legal advice. But as a 1st time buyer keen to hear your opinion. A large freeholder has decided to repair their housing stock. The work has been completed, but the bill has not been sent (due to it being a large slow organisation). Estimated bill £7k. Questions is who should pay? I could argue they should reduce the agreed price by £7k, but then we don't have a spare £7k lying around to pair for the repairs. Teh realestate agent never mentioned any outstanding bills and this has come up with our solicitor doing their job. As far was we were aware we were buying a leasehold flat in really good external condition and so our offer reflected this. Have not spoken to our solicitor yet as only received the documents today. What are your thoughts?

Have you exchanged contracts ?

ognum

The agent will only know what the vendor has told them so they may or may not know.

Well done for reading the legals, so many people don't! I assume the repairs are complete and you have not already exchanged contracts.

It is down to negotiation, if you simply don't have the money then say so, ask your solicitor to contact there's and negotiate that they will pay it you will drop out after all the repairs were done under the vendors ownership.

My guess is they will be expecting this so just get your solicitor to open negotiations.

gatsbyNZ

Thanks. Not exchanged contracts. It was a war and peace epic envelope of documents.

[Deleted User]

I personally think it is fair to ask them to pay, citing that your offer was based on the understanding of no major work to pay for. They may or may not agree, and your second line could be that you don't have enough money to proceed and have 7k ready for this bill. You would have to walk away if they didn't pay, leaving them to start again and find another buyer.

One way this can be done is that the purchase price, mortgage amount etc remains the same. However your solicitor holds back an amount e.g. 8k, until the actual bill comes through, then pays the bill and gives the the vendors get any change leftover from 8k.

Another way is for them to drop the price by the estimated amount of 7k, in return you agree to pay the bill however much it may be, taking on the risk that it might be more than 7k.

I bought a leasehold flat, and discovered during searches that an estimated 12k of work was coming up over the next 5 years, the first part would be 4k. I pointed out that I couldn't afford the flat and the 4k in the first year of ownership, and the vendors agreed to lower the price.

Good luck in your negotiations, hope it all works out.

Kynthia

If the price you offered, and valuation, was based on the condition of the property after the works were done then I'd argue that paying the leasehold bill would be paying for the works twice.

skintpaul

I thought 'major works' needed to be paid up front, so the builder can get paid on time.. I doubt they'd be happy waiting for someone to sell, before getting any money..


Seller should pay, but arrange a retention from purchase until get proof they have.

Hoploz

Is that actually the final amount due?

There is usually a sinking fund paid into alongside the regular outgoings which is designed to pay for/contribute to large long term repairs. Have you checked this out?

Mickygg

I wouldn't care who should pay, if it was me, I offer on a house or flat based on all debts being paid in full before exchange or on completion.
The seller should pay for this, if they don't I would drop my offer by £7k. That simple or I'd walk away.
If be furious being told I had to pay £7k bills before I'd even started living in the place!!