House vs flat

[DaisyDreamtime]

My partner and I are hoping to buy a first property. We’re in London and it’s highly unlikely our funds would stretch to a house, even in outer zones, so I’m thinking of flats. My partner is very concerned about buying a flat due to it only having a leasehold. He has heard so many stories of people being given huge bills by the freeholders for maintenance work on the property etc. I think he’s probably got an exaggerated sense of this risk – SO many people live in leasehold flats, they can’t all be being fleeced by freeholders (he’s prone to catastrophising). Or have I got my head in the sand, and he is right?

It varies.

This government website is useful https://www.lease-advice.org/costs-and-charges/service-charges/about-service-charges/

Also, avoid buildings of at least 7 stories or more. They come under the Building Safety Act and you can have all sorts of extra costs.

You are both correct - there will be a service charge or shared costs and obviously some risk and your neighbours may have different proprieties to you. Many flats come with a share of freehold. Choose carefully and do your due diligence, or save a bit more and wait for a house. London prices are coming down, it's a good time to buy

The only advice I gave my children was could you live there for 10 years if you had to. If the answer was no, then move on, I’d say the same to you.

as someone that has experienced leasehold hell, I strongly side with your partner. DONT DO IT.

It does really depend. When I lived in London the leasehold on my flat was owned by Westminster council and it was fab. Very cheap maintenance and if anything went wrong they came over really quickly. My friend’s flat was a private leaseholder and she was stung for thousands when they decided the building needed new windows. Of course half the residents refused or were unable to pay and it was such a stressful kerfuffle.

What budget do you have? My DB and his family bought a house in Catford last year for the same price he’d pay for a flat where I live (Crystal Palace).

I happily lived in a flat outside the U.K., where there is no leasehold (instead there is a special system of title), solid construction and high level of regulation of costs etc.

when I moved to the U.K. I rented a flat and then bought one. Lesson learned was that I think you have to do a lot of due diligence, now even more so then before. Leasehold issues, cladding and other potential costs, poor sound insulation, etc.

If it's at all doable I'd go for the house always, as posters have pointed out there are snags with flats.

Thanks @Tortephantcan I ask what would constitute ‘due diligence’ in this context?

Eek sorry to hear that @nomchonge1- was it to do with big bills?

Not sure yet, discussing with financial advisor

yes we had a very high service charge (it went up from £3000 to £8000 in the 6 years we had the flat) - with no rhyme or reason.

we sold the flat in late 2024 and so i can imagine its increased since then too.

To give an idea how how disproportionate this was to the value of the flat, we bought it for £450k and sold it at a loss of -£35k. Zone 2 London.

As a leaseholder you have zero power or control and the leaseholders are often large companies and feel like complete pirates.

One family in our building couldnt afford the sudden demand for more money so they asked to be able to pay in instalments, the management company said yes but you need to pay an extra £100 per payment as an admin fee. They would charge us to reply to emails as "admin fees" etc etc. The whole thing is just horrendous and so many people are trapped in these situations because they cant sell their flats.

We moved from flat to house last year and I'd do anything in your position to get the house. Even buying outside London and commuting in.

I'd ask for copies of the bills for the last 7 years, a copy of what's been done, what's been discussed etc to get a proper understanding of potential costs. I would cross reference this and ask the solicitor to ask the vendor and the freehold owner and other neighbours too. I'd also want to meet the other neighbours.
I'd also do some research to understand how long other residents stay eg do the flats change hands every few years or do people stay 10yrs +. Both where you are looking at and any neighbouring properties too. If they change hands frequently that would be a red flag.

I own a flat in Zone 2. I'd suggest looking for a place where there is a residents' management company rather than an external property management company, as that means leaseholders are in charge of budgets, works etc. (you can usually get involved too). We have this and our SC is not too bad - £2,500/year but we have a gym, swimming pool, concierge, well-maintained green spaces etc.

Not a chance in hell would I become a leaseholder, no matter how cheap or lovely the flat is. Even shared ownership would be the (slightly) better option, but ideally it’s best to get a mortgage on a house even if you have to commute in from a long way away. Also flats don’t appreciate in value as much as houses, generally. Your partner is bang on the money here. Yes a lot of people live in those flats but I bet a lot of those people would love to live in a freehold property and they’re stuck.

Have a look on Rightmove and filter out flats for sale, then you’ll see the huge numbers for yourself, many reduced and many for sale for ages, some years!

Be the master of your own ship.

When I was deciding between buying a do-upper house or a nice new build flat I found out that:

1. My freehold mortgage payments would go down with time, the grounds maintenance of the flat could only go up (sometimes massively)
2. Council tax was much cheaper for a big old house than a small new flat.
3. I avoided brand new properties as it is always a lottery what kind of neighbours you are going to get so considered houses in tidy area with well kept gardens OR flats with well kept communal areas and no shite hanging out of balconies.
4. also, don’t buy flats in new developments, they are like cars: they will be worth less than you paid for for a few years if you want to sell, sometimes down by 20%

Some of my younger colleagues and relatives have skipped the flat stage and bought a house in the outer zones/less fashionable parts. I think it’s a good idea tbh.

You’re both right - depends on lots of things. BUT have had friends in similar situation where they own the flat but are governed by the management company - no pets etc and it’s ended up being a nightmare as despite owning you still have to follow their rules and they had trouble with the service provided or supposed to be. They pay the charge monthly but the services it’s meant to cover are either very irregular or non existent.

Also had people who had no issues - I personally couldn’t do it.

Depends what your preference but when I lived in a flat for a while I really missed the outdoor space of a garden. Not even a big one but there was absolutely no private outdoor space. It was the one thing I really remember that I couldn’t get used to!

I haven’t bought a flat for this reason, and have waited to purchase until I move back north in the summer. Only been the last 3yrs i’ve been in a position to buy in the South East, as a single parent i’ve rented for years. What put me off buying a flat is the service charge, as many in my area are £220 plus (my block where I rent now is £130 which I think is reasonable) but also the fact that they can increase in cost so much and you’re stuck paying it. Friends of mine live in a block for key workers and over the years went from £80 to £220 which is a lot, as many own 50% and so £220 a month is a big chunk of salary.

That said, I’d have probably bought a flat if I was staying long term in South East as you need to get on the ladder. Other option is to consider how far out you’d need to move where a house becomes affordable.

I live in a leasehold flat (long lease Victorian conversion). The only costs I pay are for shared building insurance. No maintenance fees, peppercorn rent etc.

So don't discount them entirely.

I think conversions are more likely to be lower cost and/or share of freehold.

Plus the laws are changing to make leasehold fairer so worth looking into that.

Same here. Had a leasehold property
once. Hell will freeze over before I ‘buy’ another one.

Oh my god that’s horrendous. My worst nightmare!!!

Thanks @Tortephantthat’s really helpful!

Thanks @curiositykilledthiscat