Fleecehold

[jpaul]

not sure he has a lease - its just a mgmt company, like we have.

We are on good land above the surrounding fens flood plain and the principal builder owns two of the 30odd properties, nonetheless, for some reason it wasn't connected into mains sewerage...
resulting in £200/pa maintenance - no lease fortunately though.

 

[Quartz]

Our smallish new build estate of freehold 35 homes requires a management company with annual fees.

As I understand it, there's little issue with leasehold itself but it is the management fees that have become the point of contention.

 

[Goodie]

Just to clarify, the homes are freehold. In order to gain planning permission a management company is appointed to look after the open spaces of the estate so the council doesn’t have to adopt and maintain these spaces themselves.

It’s probably explained a little better in the linked article.

Lord Moylan, who advised Mr Johnson when he was London mayor, blamed councils for abandoning their duties.
"They will accept the additional council tax that is generated by the new properties but they will not take on the responsibilities for maintaining those common amenities," he told peers during the Lords' second reading of the bill.
He added: "I think this is the next great scandal approaching the housing market."

 

[Mekrel]

My previous property was a leasehold flat, the service charge went up 40% after the first year. It really was an absolute nightmare dealing with the management company and trying to get transparency on the costs, and what processes they had in place to ensure competitive costs were being sourced.

We ended up writing to the freeholder and getting them to change management companies, the new one was much better as whilst the annual fee stayed the same, the service was much better and the sinking pots were not going underfunded.

It still annoyed me greatly though, my neighbour once came around for a tea and we watched the cleaner pull up, spend 10 minutes vacuuming (three story communal area) before leaving. These management companies have no way of ensuring which service providers have visited and when.

No offence OP, but I don't understand buying a freehold property on an estate that requires upkeep charges. My friend has bought a house like this recently and there are charges for a parking enforcement company which is mad considering the estate is pretty much in the middle of nowhere. It would make more sense if the estate was next to a town centre, train station or shopping centre that charged for parking.

I was reading an article only this week that apparently Gove has already given in to lobbying from investors and pension managers on leasehold reform.

 

[arknor]

Whats an estate sinking fund?

 

[Richie]

The laws in Scotland are far better than England about this.

How so?

There are estates in Scotland with maintenance fees to cover the landscaping etc as the council don't adopt it all

 

[Stu999]

Whats an estate sinking fund?

Read the thread.

 

[Skynet5]

We live in a leasehold estate.

Bought the freehold a few years back after living here for 10 + years

At the time the ground rent doubling was in the papers.

I had a solicitor look at mine and they said it didn’t double, but the wording was really really poor and they had to read it a few times before they decided it didn’t double, just increase by £25 every 25 years. We paid £210 per year for 10 years.

On buying the freehold lots of the covenants merged, which in general I was ok with as they assure the estate (2 roads) stayed looking nice. No one can tarmac their garden, no one can paint their house pink etc. most of them in general are good.

We don’t have a management charge thankfully.

I know someone that does elsewhere, they didn’t get any charges for a few years whilst the estate was being completed ..but then it all started.

In the back of my mind I’m always wondering if there is something that will bite me. But having being here now close to 15years, 5 of which I’ve own the freehold and not heard a dickie bird from the management company of the builders (that collected the ground rent) I hope we’re good and if they were going to try something they would have done by now.

With all the press and government taking a look, that also might discourage them.

When I asked about buying the freehold they responded with, don’t worry we will never sell your freehold to someone else. Ever. I responded that that isn’t what I asked lol.

 

[ProStreet]

Never buy leasehold. Never buy freehold with a service charge.
It is a scam. They can ask for whatever money they want at any time and you have to pay it.

Freehold and freehold only.

 

[jpaul]

Just to clarify, the homes are freehold. In order to gain planning permission a management company is appointed to look after the open spaces of the estate so the council doesn’t have to adopt and maintain these spaces themselves.

do you think the abdication of sewerage/waste-water responsibility was the council or water board decision, or conspiracy (we're in the same boat, as i say)

 

[Goodie]

do you think the abdication of sewerage/waste-water responsibility was the council or water board decision, or conspiracy (we're in the same boat, as i say)

I have a deeper rabbit hole for that one. I think it was somehow tangled up to justify the management company further somehow. I did speak to the water board (united utilities) to question the possibility of adoption, however they stated that the pumping station wasn't to the standard that they would adopt. Conveniently.

 

[Skynet5]

Never buy leasehold. Never buy freehold with a service charge.
It is a scam. They can ask for whatever money they want at any time and you have to pay it.

Freehold and freehold only.

It is. But unfortunately many people go and buy a house and expect to own it. The complexity of it all is hidden to many, and that’s the problem.
Solictlrs sign it off, mortgage companies stump up the money… makes people feel all is good when it isn’t for many.

Not all are bad. But many are.

 

[dazzerd]

All this is being looked at by the FSA or whatever it's called now. But you will find most new build estates which don't have a through road to a main road are built with these type of terms. I.e. freehold properties but fees to cover the upkeep and maintenance of the estate. It's generally specified by the council so they don't become responsible for the costs, i.e. the estate roads, pavements will be unadopted hence if they go **** up the council don't have to pay but the company responsible for the estate which tends to be actually just the freeholders, will be.

I suspect it will all come tumbling down at some point when a sewer collapses or something and the freeholders can't or won't pay.

 

[Hotwired]

I'm on one of these things.

They're taking about 30k a year from the houses in this particular agreement and about half goes to management fees.

Here's the thing, these exist because the council did not agree to take over the costs of the roads, lighting, whatever so the road is basically private and it is completely impossible to get 50 households to pay up for maintenance on demand.

Thus the necessary evil. Is it more evil than necessary? Maybe.

I've also lived on a private road that had no agreement at all. You could tell where it came off the council maintained road because suddenly there was no lighting and loads of potholes. That was at the start and for the next 10 years it never changed because there was no agreement and loads of whinging or silence when attempts were made to collect money to fix things.

Freehold with no extra charges is great as long as the council is picking up the bill for your area.

 

[Werewolf]

I have a deeper rabbit hole for that one. I think it was somehow tangled up to justify the management company further somehow. I did speak to the water board (united utilities) to question the possibility of adoption, however they stated that the pumping station wasn't to the standard that they would adopt. Conveniently.

Unfortunately I suspect the builders went with the cheapest option they could, not the published requirement by the water company who if/when they adopt them want them to be to the standard they use elsewhere, largely because it then makes it easier and cheaper for them to maintain, IE they are unlikely to find something that requires complete rebuilding of it a couple of years later, or that they have to knock down a wall to pull the pump if it goes*.
The suspicious part of me wonders if the builders do it on purpose so they know you can't take a potential cash cow away from them if enough of the property owners join together.

*IIRC the local pumping stations near me all seem to be designed so if a pump fails they can basically pull it out onto the back of a truck and drop a new one in, or lift it out for easy access to repair with minimal time, effort and cost (unfortunately this means they are reasonably large buildings usually with a hulking great H beam or similar sticking out so the pump can be hoisted up and rolled along it).

 

[BUDFORCE]

How so?

There are estates in Scotland with maintenance fees to cover the landscaping etc as the council don't adopt it all

I'm far from an expert, but my basic understanding is no one owns the freehold of the block, there isn't such a thing, each property owner in the block shares responsibility of maintenance through the council or a factor company and each flat is owned in a freehold basis or the Scottish equivalent.

There are no leases either, so no shenanigans where you have short leases or change in the terms of the lease.

So you are correct in that you still have to pay factor fees, or shared maintenance, but no private company or individual has control.

 

[arknor]

Read the thread.

Seems easier to read an image, get perplexed and make a reply.
but thanks for the advice.

Why not just reply to every thread/post with "google it" then we can close the forum and end all social interaction once and for all

 

[Resident]

Leasehold feels like the UK version of the US's HOAs

 

[ProStreet]

I got out of a leasehold a couple of years ago. It was one of the most stressful times of my life. There's so many issues with flats. Service charges, ground rent, cladding, those with less than 125 years remaining being classed as an AST, flat prices have fallen by a crazy amount, the costs to actually sell it.

I bought a flat for £260k in 2017. Sold it for £225k in 2022. A similar size flat in the same block just sold for £185k today.

Bought a freehold on a private road. No stress. Just peace. I hate owing people money or not knowing what's going to show up through the letterbox. It's just stress. Yes of course you can have issues with your house, but at least you're in control with how you sort it out.

 

[Hotwired]

Actually the piece makes a good point.

The council refuses to take up the new build area management hence the management companies existing to do the necessary.

BUT AM I SEEING LOWER COUNCIL TAX?

The hell I am.