To think buying a flat is the right idea

[Losttheattitude]

Morning,
I have one DD, her dad passed away just after her 8th birthday, at the time we were living close to London in a big frankly disgustingly expensive house. My late DH did have life insurance which covered the remaining mortgage and left a little.
A year after he passed I got offered a job in rural North Yorkshire that I couldn’t pass, sold up the house and bought an equally lovely one for less than half the price!
All the remaining money was put into various investments for my DD. DD is now 19, she’s in her first year of uni in London. The money left from the house sale has gone to various things, a car, a gap year, uni fees etc.
DD wanted to stay in uni accommodation for her first year, easier to make friends. She loves it and loves London.
The money has been gathering interest the whole time so we now have over £750,000 (taking off the uni fees which are in our mind already “spent”).
Obviously it’s London so depending on where you look that could get anything from a 3 bed terrace with a garden to a studio flat!
DD has fallen in love with a one bedroom flat in a lovely area, close to central, its share of freehold, has a little balcony, but it’s £650,000. I decided to talk to my family about it.
My parents think the money should be going to a house, yes it won’t be central but it will have longevity.
My brother thinks I should put the money in a pension (half for me and half for DD). He doesn’t agree with “hand outs” and thinks DD should work for a house etc. like everyone else will have to.
Now I think I disagree with my brother, the only reason she is able to have this money is because her dad passed when she was young! I’m sure she would trade it all for her dad, and if he were still here we’d probably still be living near London with the mortgage just about paid off. She has dealt with anxiety, depression, an abusive ex. She got AAA in her A-levels and has worked her but off!! I also don’t view the money as mine, I took money out the pot for holidays etc. I’m mortgage free, have extra money to put into my pension every month and don’t stress about money at all.
I do see my parents point but I worry that a house further out would be more maintenance than DD would like and be a bit of dampener on the social life. I’m sure DD could just sell in a few years if she wanted that.
Does anyone have any insight that might make us change our mind before we go full steam ahead with this flat? AIBU to think the flat is the right idea? Should we be considering something else?

Best advice so far. The UCL buildings are around Warren Street, and both Brixton and Clapham are on tube lines that go there.

Clapham is where the young people go, and probably has more of the vibe she is after as a student.

I'd suggest reducing your budget to £425k and looking in zone 2, rather than paying £650k for a zone 1 flat. Look for proximity to tube station and dear god, don't look for a house.

To a house, she'll have to live so far out it won't be London, and she won't have the London experience she wants. All this nonsense about buying a house rather than a flat comes from people who don't live in London. Flats hold their value just fine here.

London property is very different to anywhere-else-in-the-UK property.

www.rightmove.co.uk/properties/143738363

I've looked at the Bloomsbury area and over £8,000 on service charges with a lease of around 100 years is pretty common. She needs to look out for that.

Surely for that money you could fund a very nice 2 bed. 1 bed will become very cramped very quickly. What if she wants a partner to move in and they end up WFH. A second bedroom for friends to stay. Just to have storage space. If there was enough money and you do have enough money, i would never buy a one bed

I've owned six different flats over the decades in London, I've also managed one for a friend who moved abroad and let his flat out.

My advice:

1. do not buy a flat in a high rise block
2. do not buy a flat in a new build block
3. do not buy a flat in a block with a lift or which might have to have all its windows replaced
4. do not buy a flat in a local authority block
5. do not buy a flat in a period conversion with a local authority freeholder

That leaves flats in period conversions (non LA FH) or flats in period mansion blocks.

As many have said, be really cautious about potential service charges. Even share of freehold can be a nightmare. The other leaseholders might be BTL owners, or have to be chased for service charges, or just be really difficult people. Buildings insurance can rocket if one of the leaseholders or their tenants causes, say, a flood.

Another problem with flats is noise nuisance from the flat above, or complaints about you from the flat below.

Another problem is freeholders who don't properly maintain the property or communal areas.

I could go on (and on) about the problems with leaseholds. In the end, I moved out of London and bought a freehold house. The nightmare is over.

The flat ownership is also "a share of the freehold".

What % of share?

Is it sort of like a part-buy part-rent thing?

Does it have large monthly maintenance fees?

Get legal advice for how all that will work out.

A house, owned outright on 100% freehold will be better.

Nobody can say whether a flat is a good buy or not without knowing specifics. Which location is it in? Is it on a tube line or does it have equivalent frequent transport and other facilities nearby? Is it a high or low crime area? What length is the lease? How much are service charges, if any, and ground rent? What size of building, how many floors and flats and what floor is it on? When was it converted - ref building regs, length of original lease etc? Is there a garden front or back or shared, and off street parking? Are the rooms of a good size and proportion and well planned so you don't have to walk through one to get to another, have good light, good kitchen and bathroom size and facilities? How does the asking price compare to other flats recently sold or for sale in the general area or in other surrounding or equivalent boroughs? Have you visited in the daytime and evenings to see what the street/ neighbourhood /neighbours in the building are like and whether it's quiet or noisy etc?

A good flat is fine for a young person, being perhaps too inexperienced or too anxious to cope with the responsibility of a house, which can be daunting. (I know someone whose father died when she was ten and left money which enabled her to buy a small brand new two-bedroom house mortgage free - suitable size and not much maintenance required for many years. At university she became mentally ill and has been since but having that property has been a mainstay and a source of security, income and stability for her throughout the years. Without it I dread to think how she'd manage or what the state of her life would be. Even with that, life has been difficult and she needs family support in various ways). Any property whether flat or house will be a valuable asset for your daughter to have now and in years to come and a proper use of her father's legacy.

If you DID want to look at Pimlico, your budget would just about afford ex local authority for a 2 bed. This is about 1/3 way up between Pimlico and Victoria tube on Vauxhall Bridge Rd: www.onthemarket.com/details/14829288/

I think most are privately owned these days. They are solid builds. My gut feel is that Churchill Gardens has more social housing.

There are a few overseas students in the cheap rental flats in Dolphin Sq, but most of the area is family owned or holiday rentals.

As a middle aged woman, I happily catch buses and tubes to the area late at night. If I was a mother of a teenage boy, I would be a little more cautious about letting him roam.

My niece studied at uni outside of London, then came back to London and got her first job.

she rented in Paddington to start with, loved all what was on offer but wanted her own place, Paddington was way out of her price range.

She had her heart set on a flat in the Kings Road, but service charges and a strongly worded discussion with her solicitor put her off that thankfully.

She has a moped so transport wasn’t a problem to her, and she started looking “out of the box”, and found a tiny Victorian two up two down in Peckham in a beautiful street, and something really, really drew her to it.

it was well within her budget, it felt extremely safe, the neighbours are lovely, it’s 3.5miles to Tower Bridge, and London Bridge, there are buses in abundance too.

she has been there a couple of years now, she is very very happy there, she has the second bedroom which she had a lodger in for about a year, before they bought three doors down.

The only problem with it, is parking a car, there is no parking whatsoever, if you have a moped you are fine as you can park in your own small front garden/hallway (a runner from the front door to the hall, and a piece of wood for the stand), and she does keep her bike spotlessly clean, she is very proud of it.

A lot of people say my niece is living the London dream, and if you are happy with what your daughter wants to buy, (would you buy it?) would she be able to live the London dream, or would it be better to find a two bed so a lodger can help with bills.

I wish you and your daughter all the best.

Hmmm. As a 19 year old student in London, does she really want to live in a one bedroom flat by herself? How close is it to the University and where all her friends will be? What happens once she has finished University and wants to move on. I'd look at choosing an investment property (or investing the money in some other way for her, whatever will get the highest return over the next few years before she is ready to buy something to live in longer term). And pay for nice student accommodation near her friends with the income. And probably have something left over.

But if you want to go this route, then I agree that a small property in a convenient location is much better than a larger property further out.

You can easily get a nice 2 bed for that price e.g. 2 bed where i am (bit further out, just north of camden) is around 400k. One bed will isolate her and set her apart from peers, whereas 2 bed will give her more flexibility eg she can rent a room to a friend and later use as a home office if she wants.

Found this looking at other property threads. I really hope your daughter went with the flat in Central option. Wishing her all the best