Reply to: Minister announces end to new-build leaseholds

[Martin@AS Financial]

Leasehold: a Mortgage Strategy investigation

Good article from Mortgage Strategy

Leasehold: a Mortgage Strategy investigation - Mortgage Strategy

[vetran]

In which case you need to pay special attention to the running of the Freehold Ltd Co. Make sure the company does not get into a situation whereby it can have a compulsory winding-up order. Make sure it has a substantial sink (sinking) fund for unseen eventualities.

precisely or they run up the list of shared jobs and they sell their flat before the bill becomes due.

[vetran]

The issue is that there are not enough good quality management agents. The vast majority that i have dealt with have been utterly woeful and tend to side with the freeholder.

sounds like an area that needs legislation then.

[AtW]

The issue is that there are not enough good quality management agents. The vast majority that i have dealt with have been utterly woeful and tend to side with the freeholder.

That's the whole point - I am effectively a freeholder by virtue of owning part of the company that owns freehold, the management company that actually does work in the building is hired by the company that owns freehold, ie - us (I am one of the Directors there), we approve things to be done.

Granted it's a small block of just 8 flats, a lot easier to deal with fewer people involved.

[Martin@AS Financial]

Problem is that as more leaseholders are involved the harder it is to get a decision. Probably best if large blocks are professionally managed.

The issue is that there are not enough good quality management agents. The vast majority that i have dealt with have been utterly woeful and tend to side with the freeholder.

[Paddy]

Yes and that’s why leaseholds on flats like mine should work via freehold assigned to the company in which leaseholders own equal shares - this way service fee is managed but no crazy tulip can happen as easily as in most new big tower flats

In which case you need to pay special attention to the running of the Freehold Ltd Co. Make sure the company does not get into a situation whereby it can have a compulsory winding-up order. Make sure it has a substantial sink (sinking) fund for unseen eventualities.

[AtW]

Problem is that as more leaseholders are involved the harder it is to get a decision. Probably best if large blocks are professionally managed.

The key is for the flat leaseholders to own freehold via corp entity (plus have long like mine leaseholders of 900+ years with peppercorn rent), for houses leaseholding does not make sense

[vetran]

Yes and that’s why leaseholds on flats like mine should work via freehold assigned to the company in which leaseholders own equal shares - this way service fee is managed but no crazy tulip can happen as easily as in most new big tower flats

Problem is that as more leaseholders are involved the harder it is to get a decision. Probably best if large blocks are professionally managed.

[AtW]

Yes and that’s why leaseholds on flats like mine should work via freehold assigned to the company in which leaseholders own equal shares - this way service fee is managed but no crazy tulip can happen as easily as in most new big tower flats

[vetran]

This is an archaic law dating back to serfdom but all governments since haven't bothered to change it.

FTFY

[Paddy]

Good.

That was an awful idea for everyone apart from the developers.

The proposal only refers to houses. The law needs to be changed (as in Scotland) that all leaseholds are converted to commonhold.

There was a case where the freeholder of a block of flats repossessed an elderly lady's flat over a minor breach of the lease when she was absent for six months. She lost her appeal in the High Court because her appeal was out of time.

Her flat was worth about £350,000 but she loses everything.

Just to spell it out; if you lease a flat or house, you do not own it, you just rent it! If your leasehold flat or house is repossessed by the freeholder because you broke a term of the lease, you lose everything. This is an archaic law dating back to serfdom but the Tories love it.

[vetran]

About time this scam was stopped

The kebab flat on lease?

[DoctorStrangelove]

Taken from FT Adviser:

Minister announces end to new-build leaseholds - FTAdviser.com

Good.

That was an awful idea for everyone apart from the developers.

+1

+2.

An even worse system than the old leasehold which at least ran for 99 years.

Even those cost an appreciable amount to get shot of.

But nowhere near the astronomical amounts demanded more recently.

Not to mention Ground Rent that went up equally astronomically ever decade or so.

[AtW]

About time this scam was stopped

[vetran]

Good.

That was an awful idea for everyone apart from the developers.

+1