When buying a property there are many factors which require consideration:-
Is it right for you;
Solicitors Fees and much more.
The answers to such questions usually require some thought at the outset; however, once answered little thought is given to them.
This may be relatively straight forward with the purchase of a freehold property (i.e. a house) however many people, particularly first time buyers do not envisage all of the hidden and future fees associated with a leasehold property (i.e. a flat or apartment.)
You may not be aware that when purchasing a leasehold property there will often be additional fees that would not be attached to a freehold transaction and you have no control over these – even if you instruct a cheap conveyancing solicitor.
Firstly, most solicitors will charge an additional fee for dealing with leasehold properties so make sure you find out what this is at the outset so you have the whole picture in respect of the fees payable.
There will also be additional disbursements charged by the landlord and management agent (if appointed) and these will be for registration as the owner of the property and will attract an administration fee. These differ between landlords and the solicitor will be unable to confirm such fees without sight of the lease and landlord’s replies to enquiries, however it is something you must factor into the transaction.
Even after completion and once you are the legal owner of the leasehold, you will continue to pay ground rent for the property and maintenance and service -charges.
Whilst ground rent is apparent and often immovable because it is written into the terms of the lease, the service charges are not a constant.
Service charges refer to the maintenance of the block, contributions to insurance policies as well as future works and often contributions to the estate. The service charges are usually payable annually and there is often no cap or indication as to what these will rise to.
Another factor to bear in mind is that if the landlord wishes to renovate or redecorate the block you will usually have no say over this and will have to contribute to the works in the next service charge payment.
Many people are often unaware when they purchase a leasehold property of the monetary responsibilities attached and so when choosing your home, think carefully when considering a leasehold property.