Hombuyer report for leasehold retirement home

AskAsk

My in-laws are buying a retirement bungalow which is leasehold. 

Is it worth getting a homebuyer survey?

user1977

The fact it's leasehold doesn't make any difference, if that's the question? I presume they'd still be liable for all repairs?

AskAsk

user1977 said:

The fact it's leasehold doesn't make any difference, if that's the question? I presume they'd still be liable for all repairs?

for internal repairs but structural will be the freeholder.  so what would be the benefit of the survey?

identify damp
identify a new boiler is needed - property has economy 7 storage heaters
identify electrics need upgrading - the property is built in 1985

can't really think of anything else as everything is the freeholder's responsibility.

user1977

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

eddddy

AskAsk said:

can't really think of anything else as everything is the freeholder's responsibility.

It's the freeholder's responsibility to arrange the maintenance and repairs, but it's the leaseholders who pay for them.

For example, if the roof needs replacing, the freeholder would get the work done - but the leaseholders would pay for it, either through the service charge or the sink fund.

So it might be useful to look at the planned maintenance and repairs; their likely cost; and how much money is in the sink fund.  A survey may (or may not) highlight other things that aren't currently on the plan.

AskAsk said:

identify damp

identify a new boiler is needed
identify electrics need upgrading

A survey won't include the boiler, and it won't include any testing of the electrics.

Also, have you checked the lease about repair responsibilities? Retirement property leases are sometimes very different from other leases.


For example, I know of Retirement Property leases where the Management Company is responsible for the heating system and electrics (and plumbing and doors and windows etc) in each flat.

In this case, the flats have storage heaters and when they need replacing, the management company replaces them using money from the service charge funds. It's the same with upgrading consumer units, replacing immersion heaters, etc when required.

AskAsk

user1977 said:

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

structural repairs are done by the freeholder in any situation and it will come out of the sinking fund or service charge unless it is major works.  that is my understanding.

user1977

AskAsk said:

user1977 said:

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

structural repairs are done by the freeholder in any situation and it will come out of the sinking fund or service charge unless it is major works.  that is my understanding.

Right, so the leaseholders are paying for it at the end of the day. So just as much interest in checking the current state of the building as for a freehold property.

AskAsk

eddddy said:

AskAsk said:

can't really think of anything else as everything is the freeholder's responsibility.

It's the freeholder's responsibility to arrange the maintenance and repairs, but it's the leaseholders who pay for them.

For example, if the roof needs replacing, the freeholder would get the work done - but the leaseholders would pay for it, either through the service charge or the sink fund.

So it might be useful to look at the planned maintenance and repairs; their likely cost; and how much money is in the sink fund.  A survey may (or may not) highlight other things that aren't currently on the plan.

AskAsk said:

identify damp

identify a new boiler is needed
identify electrics need upgrading

A survey won't include the boiler, and it won't include any testing of the electrics.

Also, have you checked the lease about repair responsibilities? Retirement property leases are sometimes very different from other leases.


For example, I know of Retirement Property leases where the Management Company is responsible for the heating system and electrics (and plumbing and doors and windows etc) in each flat.

In this case, the flats have storage heaters and when they need replacing, the management company replaces them using money from the service charge funds. It's the same with upgrading consumer units, replacing immersion heaters, etc when required.

we have just started the process so no information yet on who is paying for the repairs, but yeah, retirement homes come with hefty service charges so that can include internal repairs that would not be normal for other leaseholds.

i am just wondering what benefit there is for this sort of property.  the most important is the damp, but we could get a damp meter and do that ourselves?

AskAsk

user1977 said:

AskAsk said:

user1977 said:

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

structural repairs are done by the freeholder in any situation and it will come out of the sinking fund or service charge unless it is major works.  that is my understanding.

Right, so the leaseholders are paying for it at the end of the day. So just as much interest in checking the current state of the building as for a freehold property.

less so as it is spread over all the properties on the complex.  

eddddy

AskAsk said:

user1977 said:

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

structural repairs are done by the freeholder in any situation and it will come out of the sinking fund or service charge unless it is major works.  that is my understanding.

Also...

You say it's a retirement bungalow - I guess there are other retirement bungalows on the development, plus maybe...

• Block(s) of retirement flats
• Parking areas
• Roads / drives
• Gardens
• Resident's lounge
• Warden's office

It's likely that all those things are maintained / repaired from a single service charge fund / sink fund. You need to check the lease.

So if another bungalow needs its roof replacing, or the block of flats needs its roof replacing, or the drive/parking areas need resurfacing etc, your in-laws will probably be contributing towards that.

So maybe take a look at the condition of the development as a whole to assess your in-laws future liabilities.


(But retirement properties sometimes have 'deferred service charges' which you should also consider.)

AskAsk

eddddy said:

AskAsk said:

user1977 said:

The freeholder may be responsible for instructing repairs, but who is ultimately paying for them?

structural repairs are done by the freeholder in any situation and it will come out of the sinking fund or service charge unless it is major works.  that is my understanding.

Also...

You say it's a retirement bungalow - I guess there are other retirement bungalows on the development, plus maybe...

• Block(s) of retirement flats
• Parking areas
• Roads / drives
• Gardens
• Resident's lounge
• Warden's office

It's likely that all those things are maintained / repaired from a single service charge fund / sink fund. You need to check the lease.

So if another bungalow needs its roof replacing, or the block of flats needs its roof replacing, or the drive/parking areas need resurfacing etc, your in-laws will probably be contributing towards that.

So maybe take a look at the condition of the development as a whole to assess your in-laws future liabilities.


(But retirement properties sometimes have 'deferred service charges' which you should also consider.)

there are 52 properties on the complex as well as the communal area and the manager office.  i am not sure a survey for the bungalow itself is really necessary.