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?

Thanks @GrandmasCatsuper helpful!

Wow @stargirl27 that’s cheap for a concierge! I’m looking at flats and have seen service charges up to £20k, and usually because it has a porter. Though one has a £10k sc with no extra amenities that I can see! I’m talking two bed flats.
OP share of freehold might be an idea. There are pros and cons to buying with just one or two other flats (like a conversion) or in a bigger purpose built building. Smaller units you risk one of the other owners not agreeing to essential repairs, in a bigger building you have less control. The biggest issue I’ve had with flats is the freeholder not doing repairs. I’ve been asking for six years for the external woodwork for the original sash windows be done and we’ve had three managing agents in that time and promises made and not kept! We had to take over the redecoration of the communal areas due to non action and that was a nightmare. Anyhoo I’ve also had good experiences, with the larger buildings.

I live in a leashold flat in London zone 3. Our service charges are £3k. When we put the offer down for the flat I asked the estate agent and he said it would be £1k… So don’t trust them and look at the paperwork!!!
we are lucky that our neighbours are on board with scrutinising the service charges and we all meet together and send emails/letters to the managing company asking for explanation for charges and questioning the proposed works. We have had refunds in the past because of that. The managing company is one of the largest in the UK (which means blanket contracts, very hard to communicate, very poor service).
i suggest to look out for who is the freeholder, ask for proof of the charges and if you decide to buy, don’t pay up blindly and know your rights. Any additional charge that goes over £250 per flat they have to notify you, for example.

Oh and another thing to consider is that newbuild flats don’t get a residents permit so you will have to pay for on street parking.

Nope, I used to have a leasehold flat and the freeholder was a nightmare. There's no way I'd buy another leasehold property.
Look for houses on the outskirts, close to a train station. We found that we could get much more for our money on a train line into London, than on a tube line. And the train is more pleasant than the tube!

If you do go down the flat route:

Long lease

Low or no ground rent, check how it increases

Avoid somewhere with lifts, expensive repairs

Never buy one with a Local Authority freeholder. They don’t have a sinking fund for repairs and are historically neglected leading to huge bills that only leaseholders have to pay their share.

I have lived in 3 London flats all owned at various stages. Older flats and converted houses have poor sound and heat insulation. New builds I would only buy from bigger national builders with cladding works completed and ideally with a residents management company in place. New flats are cosy and warm and heating costs are extremely low. I had a house in the suburbs with awful neighbours and the maintenance was a lot more than I thought. In the last 10 years I had to replace one tap for my flat. Also being in a more central location means my commuting costs are extremely low and no train fares increasing every year. So there are pros and cons. All the flats in my last, large development sold without issues.

my first two properties were leasehold flats. Had no issues really. Service charge of course you have to pay (I think mine was around £200 / month) but that did include things like repairing leaks and blockages and covered the buildings insurance too so you don’t need that separately. Ground rent was a nominal amount which stayed the same each year. Just get your solicitor to do all the due diligence and make sure they flag anything up like any major works coming up that you have to pay a share of that is extra to the service charge.

I’m a lease holder and 9 months ago they demanded £500 out of nowhere last month £1670, plus they increased my monthly charges from £99 to £280 in under two years. It’s stressful.

We have a London flat but it’s share of freehold (small block) and we don’t pay a management company so whilst we are jointly responsible for the maintenance, we don’t pay any extra fees. It’s a bit of a pain but I’d rather live in a nice part of town in a nice flat that a shit part of town in a house so 🤷‍♀️

Im in zone 5 in a maisonette - we share the freehold with the man below us. This was the best of both worlds for us as we couldn’t afford a house in the area.

i Would say don’t buy a high rise snd don’t buy where therr are social housing properties above you. Sometimes if, say there’s a leak from above band plumbers need access, the tenant doesn’t allow access. I know of a few cases but I hope it’s very rare.

I’ve owned a leasehold flat, London zone 2. No issues, the service charge was around £1800 a year when I sold in 2022. I owned it for 25 years and whilst it increased a lot with inflation in that time we never had any additional charges and ground rent was fixed at £150 and never increased. The exterior of the building, communal areas and gardens were well maintained throughout but no porter, lifts or gym or anything.
I now have a share of freehold flat in a conversion. We have total control and I’m lucky that the other directors are all communicative and on board.
I think you only hear the horror stories. In an ideal world I’d prefer a freehold house but for the location I want I’d need to be a millionaire!

We owned a rental flat (not London) and had tenants living in it for 18 years. The management fees were so high that we hardly profited. A house would have been a much better investment

Thank God it’s sold now

sorry OP for hijacking thread but @somanythingssolittletime I live in outer London and we have a fledgling residents associated and are starting to challenge agents etc, don't suppose your agents and freeholders are ultimately owned by a billionaire fruit / soap named family as I'd love to connect to know of strategies that worked for your RA.

I have no idea who owns it tbh our freeholder is Peabody

Yeah I would avoid flats if possible OP, when I was house hunting as a FTB I wanted to look at a flat but changed my mind when I realised the monthly service charge was higher than my mortgage would have been!

Just for a different, positive experience of buying a flat!

We bought a flat last year in zone 3, London, and it's one of two flats in a converted house. We don't pay a service charge, just payments as and when for building insurance, getting the lights and fire alarm tested in the communal hallway yearly. We know that we have some external work to pay for in 2028 but we put money away each month for this. Also, noise from upstairs hasn't been a problem at all but maybe we are lucky with neighbours.

There is no way we could afford a house in the area, and we really didn't want to move further out of London just to afford that. We avoided flats in blocks for the service charge reason.

Definitely buy a house. Surely you want some outside space, even if small?

We are in a ex council flat , leasehold owned by housing association. Built for size and a lot of storage, been there for ages now.....

try to find out who the leaseholders are. The best is to have a council or HA leaseholder

Our service charge increased from £1750 to £1900 in the 7 years we have lived here. We have to get a new fire door each due to building and safety regulations so we will have to make an additional 1k contribution (only foreseeable contribution in 7 plus years) with the rest of the money coming from the sink fund. Other works all funded by sink fund.

The flat is residents managed and freehold is owned by 19 of the leaseholders. My priority was and still is school catchment, we are considering private but even if we do go state, my son is covered from age 4 to age 18. The cost of independent schools (at any cost) is in the hundreds of thousands. My flat is in London z3 and i dont run a car, commuting would have cost me £10k combined every year plus cost of running a car. So actually service charges are much more economical for me!

I would say this - do your due diligence, buy a share of freehold and above all buy in an area where there would be benefits for you (preferably cost savings) aka can walk/bike to work, can get into a great school/walk to a great school etc

A lot of maisonettes have small private gardens. I also didn't want to spend 1.5 hours commuting and 10k on the 2 season tickets.

Down here in london its very much pay service charges or rail fares. Or much larger mortgage (which can make things tricky if on statutory maternity pay).