Opinion on buying a leasehold flat

[Mabsa]

I am a First Time Buyer in the process of buying a leasehold flat in a 3 storey building. I am still waiting for all the searches and documents to be provided to me. However, I have noticed in the Fire Risk Assessment that the overall rating is Moderate (Moderate Harm and Medium Likelihood) which makes me nervous. I still haven't seen the EWS1 certificate, awaiting for it.

The report mentions: The external wall construction of the building does not appear to be of sufficiently low risk that it can be assessed visually as part of this Type 1 assessment. Parts of the front building façade has timber cladding. A specialist survey will be required.
Balcony approaches on first and second floors to rear of building appear to be constructed of non-combustible materials. There is some timber cladding to the front elevation

The building is owned by a Housing Association so this would be their responsability. However, I am worried about the potential impact that this could have if I decide in the future to sell the flat. What's your view on this? Anything I should be checking? Since I am a cash buyer, I didn't have to get a mortgage approved, hence my worry.

I am also not sure that a EWS1 certificate will be available as the building is only 3 storeys (picture attached)

I dont know about the stuff listed
But
How long is the lease ?
Iost thousands years ago on a leasehold flat

Id def try and get one with share of freehold if buying a flat

Definitely try and buy something, anything, freehold rather than leasehold.

There are 'share of freehold' flats around, and I would try and find one if my budget doesn't stretch to a freehold house.

But I'd buy the cheapest, grottiest freehold house over anything, but if not I'd go for a share of freehold flat, with as few owners as possible (easier to reach agreement with fewer people involved), like a quarter share in a block of 4 maisonettes for example.

I would not buy a leasehold flat. There are so many nightmare news stories about cladding needing to be made safe at huge expense to leaseholders, and ever-mounting service charges, and they are becoming very difficult to sell because the ongoing problems they bring are being more widely publicised.

The lease is 170 years so a healthy one. However these questions make me wonder if I should withdraw from the process.

A few thoughts:

• some bank are reluctant to give out mortgages if flats like this don't have an EWS1, even if they only are a couple of storey high
• This one seem to have wood cladding and I would be concerned about it. It is a fire risk and also might prove costly if the housing association decides to remove it. All leaseholders will be billed for the work with little control on how it is done and how money is spent
• I used to have a shared-ownership flat in London in a building owned by a big housing association and it took them forever to do repairs to communal parts and the service charge kept on rising sharply every year.

Personally I would not buy this.

I would instead buy a flat with a share of freehold in a building that does not have any potentially flammable material or relocate somewhere where I could afford a house. That's what I did when I sold my shared ownership flat: I left London to buy a small terrace on the Kent coast.

170 is not healthy

Youd very very likely lose value
And struggle to sell

A healthy lease is 999 years or at least 500 years

Id withdraw

I learnt the hard way

What Startingagainandagain said :

"Personally I would not buy this.
I would instead buy a flat with a share of freehold in a building that does not have any potentially flammable material."

I would withdraw. And OP, as a cash buyer you are in a brilliant position to get what you would ideally like at a good price.

Also if you did go ahead with the leasehold flat, when you come to sell it is likely prospective buyers would need a mortgage, and they might find it hard to get a mortgage, so I definitely advise caution as it could turn out to be a very bad investment.

Not sure i would go ahead, if the association is L and Q then run...dont do repairs and dont respond as friend has one with them. over 3 floors has new fire regs that can cost thousands so might not be a problem. i would try to find freehold if poss.

Thank you for your views - I share similar concerns. The flat has a healthy lease, reasonably priced and the location is very convinient for me. I have asked for a EWS1 certificate too - if it doesn't have it, I will pull out probably.

Would you say that wood cladding is a big deal breaker? I am worried about future costs and also the potential to resell it.

Thanks

I wouldn't.
170 isn't a particularly good lease.
What's the service charge ?
There is a LOT in the press at the moment about leases and the steep rise in service charges.

Thanks - I thought a lease over 120 years was healthy. Why do you think so? Interested in your views.

The service charge is around £1600 yearly and there's no ground rent. The freeholder is a housing association called Notting Hill Genesis, which is also something that worries me as their reviews are appaling...

Exactly

If you owned it 3 - 5 - 10 years .

Youd struggle to sell and loose value

Very rubbish lease

Had a bad service charge company with my old nightmare flat

Honestly - id avoid buying a leasehold flat

Leasehold is a scam. I live in a leasehold flat. The additional costs are ridiculous. Then you have to keep money back if the freeholder wants to get new windows or put in a new security system, which you will have to pay for. I've list 1000s on mine, and am stuck here until I convince someone to buy the dump off me. Honestly, save your money and get a freehold house, even if it's only got one bedroom, then at least you know you aren't relying on greedy buggers charging you for thus & that at inflated prices.

Sorry, typos.

I disagree with most here. I think 170 years on a lease is very healthy. I’m looking at flats with far shorter leases. The wooden cladding wouldn’t put me off. Others here advising to get share of freehold - but that doesn’t mean there’s not a lease too -so be warned on that.

I own a leasehold flat and it’s fine - don’t let that put you off. As long as the service charge isn’t ridiculous (we don’t have one for ours), and 120 years + is a healthy lease - yours is exceeding that. Make sure there is a sinking fund for reissues and maintenance.

do check the ews1 certificate. £1200 service charge is decent. I know people with share of freehold and have management fees of £3-4k and no maintenance as the owners can’t agree so it’s not always freehold is better.

There is a lot of scaremongering going on.

Owning a share of a freehold on a flat can throw up a lot of issues too. You have no control over who buys a flat and they may just sit there doing no repairs and not contributing to anything. They will moan and not pay for a leaky roof because they live on the ground floor. An established Leaseholder with a good management company will sort out these issues for you.

A lot of people move into flats and expect to pay nothing to maintain them, it will cost you a bit like anywhere else you live

An 170 year lease IS good. What is the service charge and ground rent like? Does the building seem in good order?

The cladding on the front would put me off but the rest not so much.

OP, it sounds obvious but with a leasehold flat who the freeholder is and the terms of the leasehold really, really matters. I've owned two freeholds. They didn't lose value (one actually doubled in value - bought in 2011). But one freeholder was rubbish and the other excellent. You do have to be prepared for repair charges - it's easy to blame the freeholder for a big bill for (eg fixing the roof) but if managed well it shouldn't be larger than if you had share of freehold and had to pay yourself.
Best of luck with whatever you decide!

Now this really is nonsense.

Owned two leasehold I should say!

Not at all

Leasehold = nightmare

I live in a leasehold flat and obviously I own the bricks and mortar but not the ground it's built on
Check out the property management company as to be Frank, they have you buy the balls and you have to comply with their terms
Obviously if you own freehold, your repairs and maintenance costs are under your control
I have just been presented with an additional invoice of £6.5k for roof repairs
There are 35 leaseholders and I live with the uncertainty, although I'm very happy with my actual flat
So it's not an outright no but please do your research
I also agree that your lease is very short which could become an issue if you want to sell

A standard new lease is 125 years, and extending a lease adds 90 years. I am looking at flats with leases between 85 and 110 years. Modern flats have leases in the region of 999 years, but they’re very overpriced new builds or shared ownership flats. There is a new leasehold act supposed to be going through Parliament soon which should make extending a lease cheaper and easier. Anything under 80 years at the moment can be tricky to sell on and very expensive to extend the lease. But extending a lease on the properties I’ve looked at is “only” about 3-5k.

If the leaseholders/management company have poor reviews then I'd avoid like the plague! Our management company are terrible, keep promising improvements that never happen, take months over basic repairs (hole in roof where tile has come off) and seem not to be able to keep a healthy sinking fund. The accounts look ok on paper (of course they do) but goodness knows what they are spending the money on, other than lining their own pockets. Our flats are not increasing value as they should because of poor maintenance. I keep hoping that the government will bring in new laws to properly sort them out!