Freehold charges cost us our dream home

RelievedSheff

It isn't really "Fleecehole" though is it?

People are aware of the charges when they sign up to buy their plot.

Sparklesandmoresparkles

The fleecehold name applies because the fees increase extortionately, or people are having their homes taken off them (although I’m not sure if this has ever actually happened), not because of the initial charges that most people would see as reasonable.

I think a lot of the problem is that many people buying new builds use the developers recommended solicitors who can never be truly independent and act on behalf of the buyer, as they want to remain on the developers panel. Of course they will give the bare bones of the charges, but there may well be clauses not fully explained to the buyer in a way that clearly shows the issues in fees going up and up and up with no control over them, or the option of having your house repossessed if the charges aren’t paid. Mostly I don’t blame the victims, I blame the solicitors for not acting on behalf of the buyers best interests, and making sure they understood the full extent of what they were committing themselves to.

I’m looking at a new build with estate charges now and have asked for a copy of the contract before we’ve even put down the deposit to reserve the plot, as I’m not prepared to give away a few hundred pounds to back out later when we discover there are these issues affecting us. We are using an independent solicitor recommended by a friend, who has no interest in the developer. But the only reason I know to do this is because of all the press coverage on these charges. The developer certainly wasn’t forthcoming in advising us of them, they just wanted the reservation fee.

gary83

Exactly you’re carrying out sensible due diligence on the biggest purchase of your life.

Anyone that didn’t & signs a contract for hundreds of thousands of pounds that they’re going to spend the next 20-30 years paying for without properly understanding what they’re agreeing to can’t then really turn around & abdicate responsibly for their own poor decisions, claim it’s a scandal, newsworthy or miss-selling.

SouthLondonUser

My issue is that any charge on which you don't have any say has the potential to become fleece hold.

In the last leasehold I lived in, insurance costs doubled right after the freehold was sold to another entity. Coincidence?

I remember reading somewhere that
The charges for unadopted roads are even worse because they are even less regulated than ordinary management charges, but I'll admit I never looked into the details.

gary83

Using the unadopted road hypothetical scenario there again there is a choice. You've never looked into it because you've never had to, like most people, why would you bother? I bet if you were thinking of buying a house on one though you'd do some quick and easy research.

A lot of people wouldn't even view or offer on a house on an unadopted road, being put off by the thought of a potential big maintenance bill down the line, or the thought of struggling to sell when the time comes as other people would be wary of it. If you chose to make an offer & go through the lengthy conveyancing process we have then you really shouldn't be getting to the end of it in blissful ignorance of the fact your buying a house on an unadopted road.

Glover1862

I’m considering buy a freehold with a service change but all the residents are members of the management company and 4 are directors, they have just fired the current service company and can self manage, this doesn’t seem too bad. The thing I need to find out is who owns the common land and is it leased to the management company for a fee, could the land be sold to someone else and have a large increases, no easy options really, no mention of estate rentcharges on the transfer document.

SouthLondonUser

gary83 wrote: »

If you chose to make an offer & go through the lengthy conveyancing process we have then you really shouldn't be getting to the end of it in blissful ignorance of the fact your buying a house on an unadopted road.

You shouldn't, no, but surely you won't be surprised to learn that, sadly, it happens.
It's a combination of ignorance and sloppiness by the buyers, and sloppiness by the solicitors who should alert buyers to these risks.

Charis

Do your homework, you say. I have bought a Fleecehold home and the charges were cunningly disguised as "Maintenance Charges" and described as being under a fiver a week for a man to mow the grassed areas and keep the estate tidy. If we didn't sign the document to that effect we could not put down a deposit. I thought it was neighbourly to contribute to the estate looking tidy, as did the others on this site. However in my TP1 the "Covenant", the "Rent Charges" and the "Maintenance Charges" have become synonymous, have imposed draconian rules on the so called FREEholder and invoke the theft of the freehold if we don't pay for forty days. "Even if you didn't receive the bill".

I have also found out, via a document of which I had no previous awareness, that there is a drainage system under the private road which will have to be maintained at the plot owners' expense, as the local council has not adopted it, nor has the local water company.

I have since spent a long time reading others' experiences all over the uk. There are indications that at least some of these companies do little or nothing in the way of maintenance and have started to jack up the annual bills regardless. AFAIK there is nothing to stop the charges being sold to investment companies, there are rumours of one whose profits go the the British Virgin Islands.

@ Gary 21 Please try and show a little courtesy to people who have found out just before Christmas that they are in the middle of a scam which may mean that until the law is changed their home is "unsellable". We are not fools, we were fooled by not being told all the facts.

Anyone realising they have been scammed can join Home Owners Rights Net which is also on Twitter and Facebook.

AdrianC

Charis wrote: »

We are not fools, we were fooled by not being told all the facts.

Let me guess... You used the developer's "recommended" solicitor?

Brock_and_Roll

Charis wrote: »

Do your homework, you say. I have bought a Fleecehold home and the charges were cunningly disguised as "Maintenance Charges" and described as being under a fiver a week for a man to mow the grassed areas and keep the estate tidy. If we didn't sign the document to that effect we could not put down a deposit. I thought it was neighbourly to contribute to the estate looking tidy, as did the others on this site. However in my TP1 the "Covenant", the "Rent Charges" and the "Maintenance Charges" have become synonymous, have imposed draconian rules on the so called FREEholder and invoke the theft of the freehold if we don't pay for forty days. "Even if you didn't receive the bill".

Terribly onerous terms I agree - what on earth did your solicitor say? He will have had all of these docs



I have also found out, via a document of which I had no previous awareness, that there is a drainage system under the private road which will have to be maintained at the plot owners' expense, as the local council has not adopted it, nor has the local water company.

It is very common that drainage under private roads is responsibility for the householders - what did the solicitor say about this?

I have since spent a long time reading others' experiences all over the uk. There are indications that at least some of these companies do little or nothing in the way of maintenance and have started to jack up the annual bills regardless. AFAIK there is nothing to stop the charges being sold to investment companies, there are rumours of one whose profits go the the British Virgin Islands.

Very true.....I would never buy one of these properties and this is one of the main reasons. Solicitor should have made it quite clear that under English law, contracts are assignable without consent unless there is a clause specifically prohibiting assignment or requiring consent. Bobby Basic law for dummies!



@ Gary 21 Please try and show a little courtesy to people who have found out just before Christmas that they are in the middle of a scam which may mean that until the law is changed their home is "unsellable".

I appreciate that you have "unsellable" in brackets as of course it is sellable. Of course to start with you bought it, and I would buy it off you today for £1k, so it is just a question of price.


We are not fools, we were fooled by not being told all the facts.

What does your solicitor say about all of this?