How much monthly / yearly fees for a 2 bed flat?
WhatKatyDidNxt · 20/11/2020 12:54
We are trying to sell a 2 bed flat, it is leasehold and there are yearly fees of about £600 a year. This is for ground rent, management fee and buildings insurance (it’s a high risk area for subsidence so this isn’t cheap). It’s not new build, it’s a house that was split in 2 about 20 years ago l think.
The last viewing we had then the viewers flounced off when they heard the fees?! I know it’s not cheapest but it’s not the most expensive either. What would you expect them to be?
mumsy27 · 21/11/2020 17:31
is it including service charge, if it is then it is extremely cheap.
Tulipvase · 21/11/2020 17:36
It is cheap but presumably there aren’t actually many services included?
How much of the cost is the ground rent? That could be a sticking point for mortgages.
We just sold a 2 bed flat. The ground rent was £80 annually, service charge was approx £1000 which included insurance but also gardening etc. We had extended the lease which got rid of the ground rent.
LIZS · 21/11/2020 17:40
How long is the lease now? Who owns freehold, could you purchase it?
missmouse101 · 21/11/2020 17:47
Our 2 bed v small flat has fees of £1200 annually and is the cheapest in the area. Fees cover gardening, exterior maintenance, buildings insurance, window cleaning and cleaning of communal areas amongst other things. We have had to have a new roof on the building and are about to have new fire alarm system and wiring throughout. All paid for from the funds built up by previous management fees.
I suggest you make a list of what's included. Buyers of flats need to understand how it works. Your fees are EXTREMELY cheap. In fact, that's not a good thing as I'd worry there isn't a healthy balance in the account if major work needs to be done. We had to take our lift out of service in the block as insufficient funds were available for its repair unfortunately.
Mydogisagentleman · 21/11/2020 19:25
Our 2 bedroom flat in a block of 8 has fees of 1000 a year.
It is around 12 years old and a rental.
We cover the fees because they can’t be included in rent.
merlotormalbec · 21/11/2020 19:25
When we were flat hunting one place was £250 a month another was £50 a month
jillandhersprite · 21/11/2020 19:33
I am one of 2 leasehold properties in a similar situation. We only pay for buildings insurance and a bit to accountant to keep it ticking over and it costs us about £300 each. We have chosen not to pay into an emergency fund so there is a bit of risk...
fluffi · 21/11/2020 20:21
I wonder if its because people are expecting fees to be low because its a converted house?
In a purpose-built block of flat then annual fees of £1000+ are expected because the communial areas that need cleaning, often extra refuse costs due to the number of residence, outdoor garden maintainence etc.
Africa2go · 21/11/2020 21:10
You need to split it out for potential buyers so what exactly is each - so list out ground rent, management fees and insurance separately.
dalrympy · 21/11/2020 21:41
That's very cheap. TOO cheap really as what happens when it needs a new roof?
Spilt between two that's a lot of cost to bear.
WhatKatyDidNxt · 22/11/2020 00:08
@LIZS the lease has about 160 years left on it so loads. A random guy owes it. We won’t be exploring buying the freehold, to be blunt we are bored of living here and want to move. We have been trying to move for 9 months and we sorted out a fair few things while we’ve lived here. If they are that fussed, then they can sort it. It’s standard in the part of the country we live, for lots of properties to be leasehold
They seemed a bit naive about it all. Weird as they were a good 10-15 years older than us. The guy was telling me how his friend pays £25 a year which simply isn’t true, he either is just counting ground rent or he was exaggerating to prove a point.
We gave them a breakdown for each thing it covers. They need to open their eyes about the realities of property buying
CatAndHisKit · 22/11/2020 02:29
that's good value, OP!
WhatKatyDidNxt · 22/11/2020 11:59
@CatAndHisKit that’s what estate agents have told us. People should have factored these into their costs. It doesn’t bode well if they can’t afford additional £50 a month. When you own a property, you often have unforeseen costs way bigger than that e.g. washing machine breaks, boiler breaks etc
Africa2go · 22/11/2020 16:57
OP I think the point is it might be £50 a month now but there's no certainty (at all) that it will stay at £50 a month. That's what people are saying. If the property needs repairs / has expenses, buyers could face a massive outlay if there's not a slush fund / things have not been maintained whilst you've been paying very little to date.
WombatChocolate · 22/11/2020 20:26
Service charges do vary. A maisonette which has no communal areas and probably private gardens, so no gardening or cleaning services or communal lighting etc. may have zero service charge and an asking and when’ agreement for communal maintenance of things like external decoration or the roof/foundations and can work where there are perhaps just 2 marionettes in the block. It can work as long as the lease has terms for enforcement if responsibilities if one flat owner tries to avoid paying up. Or, such maisonettes or flats in very small blocks might have a service charge and be building up a sinking fund for when expenditure is needed, but much lower than in large blocks with kits if communal areas which need heating, lighting, cleaning, gardening and lifts.
Often people buying flats are first time buyers and are a bit green on lots of home buying issues. If they have only seen somewhere with no or low service charges, when they see somewhere withhigher charges they can be shocked. All you can do is spell out what is included and Ask the EA to educate them about what is normal.
I’d say that a service charge if about £100 per month is pretty standard. I can understand why people might be reluctant to pay much more as it adds a lot to the monthly costs after mortgage etc, but people do have to be realistic about what is normal with flats. Even if you get a maisonette with no service charges, at some point you are likely to have to pay for something hefty and for many people, having made mo they payments is better.
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