Ex-council vs. Newer apartment dilemma

SeikoAlpinist

Hi there! We are first-time buyers (in our forties - no family money here!) at the stage of making offers on a couple of properties we like. We viewed 17 flats in just under three weeks and have pretty much narrowed it down to 2 or 3 of them. The two currently in contention are what we need help deciding between. I have found the biggest struggle in all of this process so far to be the sense that we are trying to compare a huge range of variables on what are essentially just qualitatively different options. So would appreciate any input from people with more experience and expertise!

We are a couple, looking for a one-bed (or affordable two-bed) flat in London. This will be a flat for us to live in for the foreseeable future, not one to sell on in a few years. We have our deposit and mortgage in principle, a mortgage broker and even conveyancers ready to go.

We did make an offer on one that was accepted already but only after we'd offered did the agent tell us about the massive imminent remedial fire safety work to walls and balconies! So less sure about that one now and the broker was sceptical we could find a lender. We are considering withdrawing that offer.

The two that we are most interested in now are both one-beds, of a similar size, with private balconies. They are both in our price range (i.e. about £300k). We could see ourselves being happy in either. But there are quite different places:

Flat 1: Fifth (top) floor, ex-council flat in a smallish block (of 20), where most are seemingly still council-owned (only two have ever sold according to Land Registry, including this one). The building is mid-century, and common entrance and hallways of the building are clean and tidy but older and a bit more tired as you might expect. The interior of the flat would need some work - new carpet and re-painting ASAP, then ideally a new kitchen and bathroom somewhere down the line. The view of the London skyline from the wraparound windows and balcony is just incredible, and the location (5 mins from a very well-connected station) is perfect too. On a quiet street in a fairly quiet area. 99 years on lease - freeholder is the local authority. Service charge £1900, Ground Rent £10.

Flat 2: Third-floor (of four floors) flat in a much newer development (of 28 flats) that was built in 2012-2013. Everything inside the building is immaculately kept and the decor of the flat itself is such that no changes would be needed in short to medium term. Exterior modern brick apartment building style (you've seen them!). Also has all mod cons like fitted dishwasher. Underfloor, air-source heat pump heating throughout the building. Communal roof terrace in addition to the private balcony. Faces on to a small park (though there's a big noisy road round the corner). A short walk from a lively High Street with lots of great places to eat, drink etc. 110 years on lease, leaseholder presumably some investment company thing, and a building management company running things who the vendor says have been good. Service charge £2500, Ground Rent £390.

We checked this time and no cladding issues etc. on the newer one. We have offered on both and think they will both be accepted imminently (today in at least one case)… but if they are, it's melting my brain trying to decide which one to go for. They're very different options. Please send help!

user1977

Council block with 90% still council tenants is likely to deter some mortgage lenders and buyers.

I presume the "air-source heat pump heating throughout the building" is a communal system? If so, that may be an issue if it means you don't benefit from the capped energy charges for normal domestic tariffs.

SeikoAlpinist

https://forums.moneysavingexpert.com/discussion/comment/82166149#Comment_82166149

thanks - really helpful to know on the council ownership, I included that after reading a Reddit that mentioned some potential pitfalls of that situation. We did ask about the heating and they said the vendor had no problem choosing whichever energy provider they liked - there's a huge futuristic-looking machine thing in there, where I would expect to find a boiler, so guess it's not actually communal and that's a heat pump for that flat? No idea how heat pumps work so didn't realise you could do that

Bigphil1474

Did your searches bring up any issues on the council block? They can be more problematic neighbour wise but could equally be a great block to live in. Having the council as a freeholder is a double edged sword. They don't tend to spend money unless they have to, but when they do, they tend to spend a fortune before anything actually happens IME. If you are looking to add a bit of value , plus the incredible view, would push me towards that if there are no red flags. Council tenants usually sign up to a good tenant contract as well, so that can help if there are any issues.

SeikoAlpinist

https://forums.moneysavingexpert.com/discussion/comment/82166164#Comment_82166164

Haven't found any reported issues, and the building did seem to be quiet and well-maintained, so we're not really worried about neighbour issues. And yes, that's exactly my thinking on the double-edged sword - the ground rent and service charge are much lower than any of the leasehold places in private developments I've seen, presumably because they don't a) try to make a hefty profit from it or b) do unnecessary work. But then when they do such work, the Reddit I saw mentioned being told they had to pay £25k for a roof, and because it's the council, their word is basically law, whereas a building management company might actually have a bit more flex over contractors used and work needed etc if there's pressure from majority of leaseholders. The view is definitely a big part of what won us over about the ex-council one! To get that view, with a balcony, and yet be in a fairly small block (four flats per floor, five stories) rather than one of those giant new-build towers seems pretty great.

RelievedSheff

Be very careful with the ex council property and find out if there are any planned works to the building. You will be expected to pay your share of any works and the bills can be very costly.

That said of the two flats you have described I would probably opt for the ex council flat due to it being on the top floor (no overhead neighbours), nice views and excellent transport links. Plus it sounds like you can put your own stamp on it over time.

SeikoAlpinist

https://forums.moneysavingexpert.com/discussion/comment/82166187#Comment_82166187

thank you! very helpful. We will ask them about planned work - don't know why we didn't do that on this one pre-offer. We were more cautious about the newer one on that front, for some reason. And yes, not having upstairs neighbours would be a bonus too!

flaneurs_lobster

Are you fortunate enough not to have to worry about parking for a vehicle?

Sorting out issues with my (private, gated) parking space seemed to take up a ridiculously disproportionate amount of my time when living in London.

mark_cycling00

I second the statement about planned or potential works being expensive in a council block.

If you're in the vast minority of owner-occupiers you won't have much influence when suspiciously large quotes come in.

Flat roofs can be a particularly expensive one. Don't assume that the council will be "nice" compared to a private management company. You can sack the management co pretty easily.

poseidon1

You indicate you are buying in London so best to be aware of the falling market and some flats selling for less than original purchase price 5 to 10 years previous -

https://thenegotiator.co.uk/news/uk-housing-market-news/more-flats-selling-at-a-loss-amid-leasehold-and-building-safety-concerns/

Personally, I would not buy ex council especially where the vast majority remain council owned. The rent paying tenants are largely protected from ever increasing building maintenance and renovation costs whilst owners are not.

As regards any and all new builds I would avoid on principle. Many flats now selling well under original purchase cost are new build.

I live in a converted London victorian townhouse with share of freehold , 995 year lease and zero ground rent. That is the only basis upon which I would buy a flat anywhere in England let alone London.

SeikoAlpinist

https://forums.moneysavingexpert.com/discussion/comment/82166206#Comment_82166206

Yes, neither of us ever learned to drive! total cityfolk. Although the newer one apparently comes with a parking space (maybe they both did actually), which would be good for guests if we don't have to just have a single registered vehicle in it