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Nov, 2014

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  1. #1

    Default New Freeholder Advice Needed!!!!!

    Hi i'm a newbie in need of advice about Freehold Law, we have purchased the freehold to a block of 4 flats we own 2 that are rented out the other's are long leasehold,lease's were drawn up in 1975 and have ground rent paid twice yearly at £15 per year the leases state all leaseholds are jointly liable for repair's/insurance, My queries are
    1) at present there is no set service charge only an annual bill for repair's/insurance our leaseholders seem to think they can pay this as and when they feel like it which alway's leaves us chasing them and either threats of going to their mortgage provider or getting their building society's to pay creating extra stress for us, am i legally allowed to change the way the monies are demanded i.e. say fine you can't pay an annual account so i will implement a proper fixed monthly service charge demand as payment towards the upkeep of the property
    2) how is ground rent calculated and as its set in the lease can it be increased as £15 seems extreamly low
    3)How do you calculate the annual management charge (our time) for organising all the repairs/insurance numerous visits to the site organising quotes & preparing the annual summary bill's etc at present we have charged a nominal fee of £40 for the year but i feel they are not playing ball so why should i waste my time helping them!!
    4) Finally can anyone recommend any legal book's that i can refer to in order to gain knowledge of Freehold Law
    Many Thanks for your time sorry if i sound naive but basically we purchased the freehold due to no end of ficticious demands from the previous FH's .........Gary

  2. #2
    Join Date
    Dec 2010
    Posts
    874

    Default

    The regime for payment of service charges will be set out in the lease and that is the only arrangement you can enforce. If you want to offer them a monthly payment option that's entirely up to you, but you can't, for example, force them to pay in advance if the lease only requires them to pay after the year end on production of the account.

    You're pretty much stuck with the ground rent. There's nothing wrong with it being £15, many leases are for 'a peppercorn'.

    Management charges - find out what agents are charging for similar properties in your area, and then discount it to allow for the fact that you do not have the overheads or the skill and experience of an agent. You might be looking at something like £100 per flat per year.

    A good start would be the RICS residential management code. Also, read the leasehold advisory service website.

  3. #3
    Join Date
    Jun 2010
    Location
    Foundation trench for New Shed@ Ham on Rye
    Posts
    15,265

    Default

    The only thing that I would add to post #2 is that the lease must allow the freeholder to recharge their "managing" costs. Leases often only allow the fees of an agent, and therefore you may have to appoint one and leave the time and effort to them, or set up your own company to deal with these issues on your block. That is not so onerous as it may seem, and can be covered in a separate thread.

    There are several texts available however there is only one that is up to date ish, and rapidly become dated.

    You can pick our brains such as they are...!
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers. More ramblings atleaseholdpropertymanager.blogspot.com

  4. #4
    Join Date
    Nov 2008
    Posts
    2,246

    Default

    ..and I'll add that as a newbie freeholder you may be unaware of the various statute laws that you must adhere too, you may find yourself with a clued-up leaseholder who takes advantage of your (maybe) lack of knowledge and witholds payment (quite legally).

    As for books there are many available but make sure its a relatively new one that take account of the changes made in The Commonhold & Leasehold Reform Act 2002, (most of the important changes in this canme into affect late 2007).

    Andy

  5. #5
    Join Date
    Dec 2010
    Posts
    874

    Default

    This is by far and away my favourite 'bible':

    http://www.wildy.com/isbn/9781847037...-and-practice-

  6. #6

    Default

    Many Thanks for the quick replies that certainly clear's a few things up, i will have a re-read of the leases, cannot recall any regime for the service charge in them so look's like i'm out of luck there!!! you would think given the Dicken's Novels & creative accounting produced by the previous freeholder's the other leaseholders would be grateful that only necessary repair's are carried out and alway's with prior notice and costings still no helping some people........very grateful for your time if off to order my bible!!!!!!! Gary.....

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