Buying a flat in London, do you know how "share for freehold" actually works ?

[messiah]

Buying a flat in London, do you know how "share for freehold" actually works ?

I mean with other flat owners in the same block/house ?

Who calls the shots for service charge payments ? Is there a legal requirement in place usually for payment of service charge for the maintenance on the building ?

[ladymuck]

I've heard of a shared freehold, which I'm assuming is the same thing. That's where a block of flats is jointly owned by all of the leaseholders and they share the costs of any maintenance and repairs. You would be both a joint freeholder and leaseholder.

This is different from being just a leaseholder where the freehold is owned by (for example) the developer that built/converted the property. The maintenance is usually farmed out to a separate company who charge an annual fee to cover costs (and usually fleece you for repairs).

Under a shared freehold, you would still have a lease that covers what you can/can't do in your flat but you are also jointly responsible for all the repairs - including getting quotes, scheduling builders, etc.

Your solicitor should be able to give you full details of how it works.

[Ivor1]

Best place for FREE FREE FREE advice over the phone is this lot, government run agency, but they know there stuff and its FREE, FREE.

http://www.lease-advice.org/newintro.htm

Also have a look here lots of people posting house / flat purchase questions, some regarding freehold,

http://forums.moneysavingexpert.com/...play.html?f=16

Freehold is generally better than leasehold, but Freehold can have problems, there is a posting on the above forum about freeholders in a block wanting to vet prospective buyers.

Whatever you do dont buying anything leasehold with less than 80 years, below this figure you have to pay the freeholder 50% of the increase in value of the property if you increase lease or buy freehold, plus all legal fees.

I ended up with a flat with 76 years lease and its been a bugger to sell, in fact its loosing value. I bought flat 4 yrs ago for £150k and have only been able to sell it for £165k, something do with the fact it was going to cost £18k to add 100 yrs to lease. Personally looking back now I should of gone for a cr*p house for £150k rather than a flat freehold and leasehold = pain in the ass.

[ASB]

One of the problems in England is that most lenders will not lend on a freehold flat. Quite a lot of lenders take a similar view of purchases based on the leaseholders sharing the freehold. It is important to ensure you can also exit your ownership of the share of the freehold for when you sell the flat on. Otherwise you can find you have some interesting liabilities.

If your conveyancer cannot explain it to your complete satisfaction (as part of the fixed price quote you should have agreed) find a better one.