Help to Buy for a Flat

Fufu3333

I am looking at reserving a new build, 2 bed 2 bath flat in Canterbury using Help to Buy - Price £216,000 - with a deposit of £36,000. 

Service charge is £1,068 per year increasing every 10 years.
Should a new management company take over management of the flats within the first 10 years, could they increase the service charge?

Ground rent is peppercorn. 

I am single FTB and wondering if I am overstretching myself.  Property prices in Canterbury seem quite healthy and I would not necessarily be in a rush to pay back the loan till I am ready to sell the flat.  Is there anything you can think of that I need to be aware of?

firsttimesellerldn

Is it definitely a fixed charge for ten years? What will they do if their costs exceed what they're charging leaseholders? And what is the costs are less - will you be refunded? Have you seen a copy of the lease yet? I'd want to look at it asap to understand what is going on here. 

There's some potentially helpful info on the dangers of fixed charges on the Shelter website here: https://england.shelter.org.uk/professional_resources/legal/home_ownership/service_charges/service_charges_for_leasehold_properties

Fufu3333

firsttimesellerldn said:

Is it definitely a fixed charge for ten years? What will they do if their costs exceed what they're charging leaseholders? And what is the costs are less - will you be refunded? Have you seen a copy of the lease yet? I'd want to look at it asap to understand what is going on here. 

There's some potentially helpful info on the dangers of fixed charges on the Shelter website here: https://england.shelter.org.uk/professional_resources/legal/home_ownership/service_charges/service_charges_for_leasehold_properties

Thanks you for this - I did wonder about that.  I will doublecheck and see if they will provide me with a copy of the lease. 

Fufu3333

Slight misunderstanding there - it's the peppercorn ground rent of £1 that increases every 10 years.