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Ground Rent - Buildings Insurance

Spidermonkey_2
Spidermonkey_2 Posts: 11 Forumite
in House buying, renting & selling
I am a new member and this is my first post here. I have searched online unsuccessfully for a reference to my question. Any help would be appreciated.

I am buying a house which is due to complete in 14 days. It is not commercial. It is leasehold. There are no service charges. Ground rent is £120 per annum.

Will the buildings insurance be my responsibility as the leaseholder or the landlords? The lease itself does not clarify.

Thanks in advance

Comments

  • nomoneytoday
    nomoneytoday Posts: 4,871 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    What does your solicitor say?
    They're earning enough to answer for you :)
  • Spidermonkey_2
    Spidermonkey_2 Posts: 11 Forumite
    Thanks for your v quick reply. I already asked my solicitor and he said he would investigate, he replied today via letter to say that the buildings insurance would be transferred into my name upon completion. This didn't answer the question I posed to him, and I posed it to him as I have posted it here. Unfortunately he's not in his office today.

    I suppose I'm also wondering was is the norm.
  • Spidermonkey_2
    Spidermonkey_2 Posts: 11 Forumite
    Bump .........
  • hedgehogpenguin
    hedgehogpenguin Posts: 95 Forumite
    the freeholder will insure it normally and you will reimburse him your share
  • Richard_Webster
    Richard_Webster Posts: 7,646 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    the freeholder will insure it normally and you will reimburse him your share

    This is possible, but not normal for a house.

    If it is a house with £120 pa ground rent that indicates it is not a 1900 ish one with a 999 year lease but much more modern. Has OP asked about how long the lease is? If it is a 99 year lease in 20 years time or so you will have to pay either to extend it or buy the freehold at a significant sum so you need to factor that in. Frankly if the lease is only 99 years I wouldn't buy it - tell the seller to buy the freehold and then you will consider it.
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
  • themull1
    themull1 Posts: 4,299 Forumite
    My mams house has a 999 year lease and was built in the 60's. She has to pay her own insurance.
  • Spidermonkey_2
    Spidermonkey_2 Posts: 11 Forumite
    My bad. I always do this - its not a house its a converted flat. The lease is 130 years.
  • silverjay
    silverjay Posts: 179 Forumite
    I live in a purpose built leasehold maisonette, buying on mortgage, there is a ground rent set in the lease and arranging buildings insurance is my responsibility.
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  • G_M
    G_M Posts: 51,977 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Normally with a well run set up, either the freeholder arranges insurance (to which each leaseholder contributes, either via a regular service charge or via periodic one-off payments) or the managing agent does this, if one has been appointed.

    Normally also the lease would specify responsibility - but you say it does not.

    Failing that, there are two options:
    1) each leaseholder insures 'their' part of the building individually. Not ideal, can lead to disputes between insurers, and of course if one leaseholder fails to insure and the building burns down, re-building becomes a nightmare!
    2) an informal arrangement arises, with one (pro-active) leaseholder organising insurance and then banging on the neighbours doors till they each contribute their share!

    I would ask the vendor what happens, and/or knock on the neighbours door, introduce yourself, and ask.
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