Bought new leasehold flat.

jstvj

I have bought an retirement flat and being affordable housing the price attracted me, despite some very restrictive rules in the lease. The management company is soon due to be transferred to the Residents. Also I understand that when this happens the Freehold is also to be transferred to the Management Company. Whilst I understand that being Directors of the Management Company the Residents have control over the service charges etc. However I do not know what rights the transfer of the Freehold conveys. Can anyone give me any advice on this aspect please.

skintpaul

who owns the freehold, at moment?

jstvj

skintpaul wrote: »

who owns the freehold, at moment?

The Developers/Builders have a separate company who are responsible for the management/service charges etc. The last apartment in the block has now been sold, so the the management company will be transferred to the residents soon. We have all Directors of the new management company. The Lease says that at the same time the Freehold will be transferred to the Management Company.

eddddy

jstvj wrote: »

...
However I do not know what rights the transfer of the Freehold conveys. Can anyone give me any advice on this aspect please.

If you look through your lease, it will tell you...

- the freeholders obligations to the leaseholder (e.g. Insure the building, maintain the common parts)
- the leaseholder's obligations to the freeholder (e.g. pay ground rent/service charges, maintain your flat)
- (probably) what the freeholder can do if the leaseholder doesn't fulfil their obligations.

Is that what you mean?

G_M

edddy sums up the relationship/obligations. Here is another way to look at it:

1) the freeholder owns the land, and the structural aspects of the building

2) each leaseholder buys the right to 'own' (live in) a part of the building (owned by the freeholder) which sits on the land (owned by the freeholder) for a set number of years, after which the freeholder will get back that part of the building (the leaseholder's flat.)

3) the lease sets out (as edddy explained) the legal relationship (rights/obligations) between the freeholder and leaseholder

4) the freeholder appoints (sometimes!) a management company to manage the land and building for him (cos he's too lazy to do it himself)

5) if the ownership of the freehold is bought by, or transfered to, the leaseholders, then the same rights/obligations exist between freeholdrs and leaseholders, even though there is now overlap in wh these people are (ie, you as leaseholder, own 100% of the lease to your flat, and also, in a seperate Title, own x% of the freehold jointly with others.

6) if you decide, jointly, as freeholders, to sack the management company and manage the building yourselves, you can.

Alter_ego

I don't think a person can hold a % of a freehold. Hence the management company holding it. Each leaseholder then owns a % of the management company.

That's what my solicitor told me when we bought a freehold.

jstvj

eddddy wrote: »

If you look through your lease, it will tell you...

- the freeholders obligations to the leaseholder (e.g. Insure the building, maintain the common parts)
- the leaseholder's obligations to the freeholder (e.g. pay ground rent/service charges, maintain your flat)
- (probably) what the freeholder can do if the leaseholder doesn't fulfil their obligations.

Is that what you mean?

Thank you for your advice, but that is not what I mean.

As you say the lease does cover the freeholders obligations to the leaseholders and vice versa. However, what if they are the same party as we will be when the freehold is transferred to the new management company owed by the leaseholders.

G_M

Alter_ego wrote: »

I don't think a person can hold a % of a freehold. Hence the management company holding it. Each leaseholder then owns a % of the management company.

That's what my solicitor told me when we bought a freehold.

Yes and no.

Freehold Titles can name up to 4 (I think) owners. After all ,ost married couples jointly own their houses!

But where there are multiple joint owners (eg a block with 10, 20 flats) it is preferable to set up a company to own the freehold as you suggest.

eddddy

jstvj wrote: »

Thank you for your advice, but that is not what I mean.

As you say the lease does cover the freeholders obligations to the leaseholders and vice versa. However, what if they are the same party as we will be when the freehold is transferred to the new management company owed by the leaseholders.

Nothing changes.

You continue to be a leaseholder and do the stuff a leaseholder has to do.

The management company becomes the freeholder and does the stuff the freeholder has to do.

As a part owner of the management company, you may be able to influence how they do what they must do. e.g. Help decide which insurer to use, which cleaner to use for the common parts, wht colour to re-paint the common parts etc.

jstvj

Alter_ego wrote: »

I don't think a person can hold a % of a freehold. Hence the management company holding it. Each leaseholder then owns a % of the management company.

That's what my solicitor told me when we bought a freehold.

Thank you Alter ego. I think what you have said is correct. The freehold will be owned by the new management company, so presumably each leaseholder will own their respective percentage of the freehold.

Does this give the management company the right to alter the lease and moreover can any individual leaseholder (part freeholder) vary their own lease themselves without agreement of the others ?

jstvj

G_M wrote: »

edddy sums up the relationship/obligations. Here is another way to look at it:

1) the freeholder owns the land, and the structural aspects of the building

2) each leaseholder buys the right to 'own' (live in) a part of the building (owned by the freeholder) which sits on the land (owned by the freeholder) for a set number of years, after which the freeholder will get back that part of the building (the leaseholder's flat.)

3) the lease sets out (as edddy explained) the legal relationship (rights/obligations) between the freeholder and leaseholder

4) the freeholder appoints (sometimes!) a management company to manage the land and building for him (cos he's too lazy to do it himself)

5) if the ownership of the freehold is bought by, or transfered to, the leaseholders, then the same rights/obligations exist between freeholdrs and leaseholders, even though there is now overlap in wh these people are (ie, you as leaseholder, own 100% of the lease to your flat, and also, in a seperate Title, own x% of the freehold jointly with others.

6) if you decide, jointly, as freeholders, to sack the management company and manage the building yourselves, you can.

Thank you G_M. With regard to 5 whilst I stand to be corrected I think Alto ego is correct.