What if Flat Owners Can't Pay for Essential Refurbishments?

NeilCr

AdrianC wrote: »

. If there was a £40k bill on your freehold house, would you extend the mortgage, or would you have drip-fed that much into a savings account to cover it?

Missed this in my first reply.

It's my responsibility to keep my freehold house (and yes I have one) in good nick and make sure that I don't "suddenly" get a surprise bill of £40k. But, in the end, that's on me if I don't and ignore good practice, I have to find the money one way or another if something rears it's ugly head.

In this case, there are directors and a management company who should be doing due diligence on behalf of the other residents. As a director that's part of my role. Others are trusting us (whether or not they should!) to make sure that the fabric of the buildings are maintained and looked after. There isn't enough in the OP to understand what has happened in the example quoted but £3 million (likely higher) worth of work doesn't suddenly appear.

I get what you are saying about the amounts involved and building that up in a sinking fund. And, again, we don't know what has happened in the preceding years. I know that when we took on the freehold of the last block I was living in there was no sinking fund and work needed doing, including redecoration. We handled it by getting the "emergency" work done - introducing an annual sinking fund payment and deferring the redec for a couple of years. We then had some money towards it and asked the residents for an additional payment when it was done. And, we told everyone what was happening