Dilemma "Fleecehold"

Flugelhorn

Have put in offer on 8 year old house on new estate, cash purchase, intending to live there for 2-3 years.

have now had lots of paperwork through and have found that the "maintenance charge" for common grounds etc is legally tied with rights for the management company to take possession of the property if fees are not paid.

have been reading up on this and seems to be accelerating problem, solicitor highlighted that some lenders are getting twitched about it.

Main problem is sellability in the future - trying to work out of "it'll all get sorted in the next couple of years" or we are better to start the whole house hunting lark again.

Anyone up to date with what is happening over this?

AdrianC

I don't know if you've heard much about politics lately, but crystal balls are all a bit broken at the moment.

I think it's fairly safe to say that not much substantial is going to change within the next two to three years. In a market that's fairly flat, that's a borderline timeframe to be worth buying a property, anyway, by the time you've covered legal costs, SDLT etc. For that kind of period, you'd probably be better renting and saving for more equity for your next purchase.

onwards&upwards

This was featured on I think Moneybox on radio 4 the other day, definitely worth a listen on iPlayer.

I will say it made me very glad my house is an old fashioned proper freehold.

Flugelhorn

Pretty well up on politics thanks.

Just trying to find somewhere to move to t'other end of the country which would be an OK house while we find the more permanent residence - (not keen on renting, haven't rented anything for 36 years) - was quite happy with this one until the flippin' estate charge thing has raised its head.

Looks like some lenders have insisted on getting agreements changed with management companies but not sure if this is a widespread occurrence.

Flugelhorn

onwards&upwards wrote: »

This was featured on I think Moneybox on radio 4 the other day, definitely worth a listen on iPlayer.

yes - thanks, I has a listen to that, very interesting - strikes me that there is a lot of "concern" about it all but not so much being done to solve it - presume it will have to get to the stage where houses are not easily mortgageable by mainstream lenders before "something gets sorted".

Darkslider

Personally I wouldn't touch it with a barge pole. We're in the process of buying our first house and I specifically wanted only a freehold with no maintenance or ground rent charges for the reasons you're now coming to realise.

Sure it can eliminate some new builds and recent housing developments from your search, but I think it's a small price to pay to not live with a Damocles sword over your head for your duration in the property.

Everyone's different though that's just my take on it.

AdrianC

Flugelhorn wrote: »

Just trying to find somewhere to move to t'other end of the country which would be an OK house while we find the more permanent residence

All the more reason to rent while you decide on precise areas etc.

(not keen on renting, haven't rented anything for 36 years)

<shrug> And...?

Don't get all disproportionate about it - you're looking for a stopgap property. Renting makes FAR more sense. To start with, how many months rent would by covered by the SDLT and legal fees for an extra sale and purchase?

caprikid1

Personally, moving to the other end of the country I would just rent. It's a very effective weapon in the house hunting arena, you can be a lot quicker to react and secure that dream house. You can offer on a property as soon as you like without having to have an offer on yours to look serious.


Given the legal fee's , flat house prices, stamp duty ,maintenance etc I would struggle to see that buying and selling in a short space of time makes sense.

Flugelhorn

Darkslider wrote: »

Personally I wouldn't touch it with a barge pole. We're in the process of buying our first house and I specifically wanted only a freehold with no maintenance or ground rent charges for the reasons you're now coming to realise.

Sure it can eliminate some new builds and recent housing developments from your search, but I think it's a small price to pay to not live with a Damocles sword over your head for your duration in the property.

Everyone's different though that's just my take on it.

Going to take that barge pole off the amazon order. Shame re some of the up to 20 year old properties as they are quite nice - reckon we are heading for another house hunt, will make sure to grill the EA on this before we view any

Flugelhorn

caprikid1 wrote: »

Personally, moving to the other end of the country I would just rent. It's a very effective weapon in the house hunting arena, you can be a lot quicker to react and secure that dream house. You can offer on a property as soon as you like without having to have an offer on yours to look serious.


Given the legal fee's , flat house prices, stamp duty ,maintenance etc I would struggle to see that buying and selling in a short space of time makes sense.

We have done it before and ended up staying a lot longer in the house than we initially intended - not that we couldn't find what we wanted, we just didn't get looking.

We do want to be in the area to get the right house as all the good ones we see are gone by the time we can visit

Flugelhorn

AdrianC wrote: »

All the more reason to rent while you decide on precise areas etc.


<shrug> And...?

Don't get all disproportionate about it - you're looking for a stopgap property. Renting makes FAR more sense. To start with, how many months rent would by covered by the SDLT and legal fees for an extra sale and purchase?

We'll all different, I put quite high value in being in my own place rather than renting off someone else, I know it costs more in then end but that is how I choose to spend my money