Fees when selling a leasehold flat

LindsW

Hi All

I am currently selling my purpose built flat which is approx 3 years old.
It has a management company who I pay a service charge to and a landlord who I pay ground rent to every year, which I believe is a fairly standard set up.
My question is, has anyone had their landlord who owns the land/takes the ground rent, charge them a set percentage of their sale price as a fee on completiom just because you have sold the property? Is this a standard thing?

Thanks

davidmcn

Not standard. Does your lease say they can charge it?

eddddy

LindsW wrote: »

My question is, has anyone had their landlord who owns the land/takes the ground rent, charge them a set percentage of their sale price as a fee on completiom just because you have sold the property? Is this a standard thing?

It's sometimes called a "deferred service charge" or "deferred management fee" - and the Law Commission calls them "Event Fees".

They often apply to retirement properties.

Some people say they're a good idea for retired people with limited incomes. They pay lower service charges whilst living in the property, but make up for it by paying a big chunk of 'deferred service charge' when they sell.

But sometimes they can be a rip-off.

Here's a bit more info:

Law Commission Final Report on Event Fees

...
Leases of retirement flats and bungalows often include a fee triggered by certain events, such as when the owner sells or sub-lets their property. These fees are typically set at around 1% of the property sale price but may be as high as 30%.

Link: https://www.lease-advice.org/news-item/law-commission-final-report-event-fees/

LindsW

Thanks both.
There is nothing stated in the lease about it, I had seen some general information online about leasehold property selling and wondered whether it is standard practice for all leasehold sales and something I'd need to consider when working out my costs.
Is it generally just for retirement properties then?

eddddy

LindsW wrote: »

There is nothing stated in the lease about it...

If there's nothing in the lease (or any other contract that you've agreed to) then you won't have to pay anything.

LindsW wrote: »

I had seen some general information online about leasehold property selling and wondered whether it is standard practice for all leasehold sales and something I'd need to consider when working out my costs.

Could it be you've read about "Leasehold Information Packs"? You have to pay the freeholder to prepare one of those - but they tend to cost a couple of hundred pounds. They're not a percentage of the selling price.