Leasehold Reform

[Callaghan777]

I belong to NLC and wonder what others think about the feudal leasehold system or "fleecehold" as it's known?

First, what is "NLC"? Never heard of it.

We lived in a leasehold flat in South London when I was a boy and my father continued living there as a widower until he died some 12 years ago.

We had no problems and I sold the flat with the unexpired portion of the lease with no trouble at all.

BUT

It was a privately built block with no service company, so there were no management charges. Expenses were split among the flat holders - each paid an equal share.

It was built in the 1930s so there were no cladding or insulation issues.

The ground rent was fixed (back in 1965) as £5 p.a, with NO increases. It was payable to the owner of the ground floor flat for use of the pathway to the back of the block.

Being leasehold was not an issue - it was simply a rented flat with the rent paid up-front for a given period.

The problem is not with leasehold per se. Rather it's with unregulated service charges and ground rent increases. These are what need to be controlled. Something along the lines of the Unfair Contract Terms Act?

(BTW our ground rent was payable half-yearly. My Dad paid his £2.50, in cash, to the guy in the bottom flat every 6 months until he died. And he got a receipt.)

Some Leasehold are better than the supposed new freehold as they've just added ‘management fees’ on the unadopted land on the new freehold estates.

I bought a leasehold flat in 2015 when the service change was £100pcm., now it's rocketed to £300 pcm.... and they've just invoiced me for a lump sum of 6K for major roof repairs in addition!
Absolute fucking scandalous.
I'm on Disability benefits so the £300 is almost 1/4 of my income
I'm so lucky that I have 3 amazing sons who are clubbing together to pay the lump sum for me
It's made me unwell from the stress

I live in a leasehold with no service charges or ground rent. The only thing I have no say in is the extortionate buildings insurance rates but otherwise it's no different to living in a freehold.

Times have changed. Leasehold has become fleecehold for many. Extortionate service charges. Lack of maintenance. I live with mould and damp due to non existent maintenance. My lease will cost me £35k to extend plus my legal fees and my freeholder"s legal fees. It's become a very corrupt system!.National Leasehold Campaign has over 33,000 leaseholders in terrible circumstances.

Moral: Read and understand your lease before signing it (particularly with regard to charges and increases) and, where possible, avoid property where the tenants don't control the maintenance.

Sadly solicitors do not warn or explain the complicated leasehold jargon. In my case I asked the solicitor for a clearer explanation and he gave me wrong info! Only realised 20 years later I have a unsellable lease!

@Normallynumb in what world did not not understand you have to fund repairs for somewhere you own? Who else do you think is going to pay to fix the roof?

@FelixtheAardvark indeed and don't be too tight to use a solictor who understands leasehold.

Our solicitor told us very early on in our conveyancing process "you are buying a lease not a flat so pay close attention to anything I tell you about the lease".

Rude!

Well not really. Homeowners have to pay for repairs, owning a flat doesn't make that go away.

You misunderstood. The freeholder is responsible for repairing roof etc. I have already paid £4k to make urgent repairs. My freeholder does nothing maintenance wise yet I have to pay him extortionate service charges! You have no idea unless you are a leaseholder with a bad freeholder. I have to take him to court but have to pay his legal fees as well as mine!

I have to say I'm clear not here. Wasn't the service charge clear when you bought the property? Has it gone up dramatically since you bought the flat?

I know that there issues with leasehold but I'm not sure what you're trying to say here but I really don't thing you can argue that all solicitors don't explain a leasehold property. Generally properties on a relatively short lease are cheaper than similar freehold properties.

If you had a freehold you'd still have to pay out lump sums for maintenance. I'm about to stump up for a new roof myself. It's all part of home ownership.

The government needs to understand that many people are happy with their leasehold arrangements. That doesn't apply to everyone, but any new rules need to accommodate people in both categories.

It may be.

However some management companies are very corrupt and add things like accountancy fees to a service charge. Service charges and the way section 20s are handled need reform

Mine is unfortunately a ‘fleecehold’. The service charge has tripled since I bought it. It’s currently unsellable. Part of the increased service charge is due to insurance costs tripling. Our management company apply a 10% ‘management fee’ to it (I guess it’s a bit like commission?) so they have an incentive to choose the higher insurance quote. We have no control over what they spend money on. They simply pass the costs to us and we’re forced to pay it.

My parents have had to pay out £50k for major repairs in the last 10 years. The last bill was 25k last year. Its awful. 😔