How to Buy a Flat: All You Need to Know About Apartment Living and Letting

225 Pages·2006·7.1 MB·English

by  Liz Hodgkinson

HOW TO
BUY A FLAT
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HOW TO
BUY A FLAT
All you need to
know about
apartment
living and
letting
Liz Hodgkinson
howtobooks
DEDICATION
for my wonderful goddaughter Georgia

Published by How To Content,
A division of How To Books Ltd,
Spring Hill House, Spring Hill Road,
Begbroke, Oxford 0X5 1RX. United Kingdom.
Tel: [phone]. Fax: [phone].
email: [email protected]
http://www.howtobooks.co.uk

All rights reserved. No part of this work may be reproduced or stored in an information retrieval system
(other than for purposes of review) without the express permission of the publisher in writing.

The right of Liz Hodgkinson to be identified as the author of this work has been asserted by her in
accordance with the Copyright, Designs and Patents Act 1988.

© Copyright 2006 Liz Hodgkinson

First published in paperback 2006
First published in electronic form 2007

ISBN: 978 1 84803 040 4

Cover design by Baseline Arts Ltd, Oxford, UK
Produced for How To Books by Deer Park Productions, Tavistock, Devon, UK
Typeset by PDQ Typesetting, Newcastle-under-Lyme, Staffs, UK

NOTE: The material contained in this book is set out in good faith for general guidance and no liability
can be accepted for loss or expense incurred as a result of relying in particular circumstances on
statements made in the book. The laws and regulations are complex and liable to change, and readers
should check the current position with the relevant authorities before making personal arrangements.
Contents
Preface ix
Introduction 1
1 The History of Apartment Buildings 17
The first flats 18
Housing for the poor 21
Moving on 22
Flat living becomes stylish 24
The problems of tenure 25
A continuing problem 26
Reforming laws 28
The history of service charges 29
2 What Type of Flat is it Best to Buy? 33
Exploring the types of flat available 33
Conversion 34
Mansion block 36
Purpose-built blocks 37
Newbuilds 39
Warehouse conversions 42
Ex-local authority blocks 42
Small blocks 44
Large blocks 45
Flats over shops 46
Shell apartments 47
Shared ownership 47
Live/work units 49
Retirement/age exclusive apartments 51
Is there a best buy? 52
Where in the block? 54
3 The Lease 57
Questions to ask 58
The lease itself 60
V
vi/HOW TO BUY A FLAT
The main elements of a standard lease 61
Further convenants 63
Look for subletting clauses 65
Listed buildings 65
Where you own a share of the freehold 66
Leases of ex-local authority flats 66
Ex-local authority block service charges 67
Payment plans 68
Are leases legally binding? 69
What if you infringe the lease? 69
Major works 70
Service charges 70
Reasonable charges 71
Insurance 72
Ask for evidence of expenditure 72
Recovering service charges 73
Application to the Leasehold Valuation Tribunal 74
The Leasehold Advisory Service 76
Ground rent 77
Forfeiture and possession 77
Commonhold 79
The management of a block of flats 81
4 Management 85
Advantages of outside management 88
Appointing a managing agent 90
The set-up 94
What a good managing agent will do 95
Code of practice 97
Forming a Residents' Association 98
Where you have enfranchised 102
5 Increasing the Value of Your Flat 104
What you need to know before you buy 106
Extending the lease 107
The process 111
Getting started 113
Which is better, a lease extension or collective enfranchisement? 117
CONTENTS / vii
Very short leases 118
Right to manage 119
How to go about setting up an RTM 120
Buying the freehold, or, collective enfranchisement 124
Making it work 125
Get moving! 130
Run the company properly 134
6 Ex-local Authority Blocks 136
Collective enfranchisement 136
Leases shorter than 80 years 137
A note on mortgages 138
Social tenants 139
Service charges 139
Residents' Associations 142
Breach of lease 142
Investment value 143
Is there a best buy? 143
7 Letting a Flat 145
The lease 145
Restrictive subletting 146 146
What kind of subletting is allowed? 148
Buying a flat to let 150
Carrying out building work 153
Being a good (absentee) landlord 155
Finding tenants 156
Your tenant's responsibilities 158
Types of tenancy 159
Short lets 160
Holiday lets 161
Leasing to a housing association or local council 163
Letting out your own home 164
Tax matters 165
8 When Things Go Wrong 167
These are the best solutions 168
What if problems persist? 176
In some cases, mediation may be the answer 184
viii /HOW TO BUY A FLAT
Listed buildings 186
9 Buying Abroad 191
Apartments in America 193
Renting out 194
Property clubs 195
The costs stack up 197
Timeshare apartments 199
Inheritance and SIPPS 200
10 Conclusions 202
Resources 208
Index 212
Preface
Before long, there will be more people living in flats or
apartments than houses. All over the world, more apartment
blocks than separate houses are being built, even in countries
which still have plenty of building land left.
This means that in future, large numbers of people are going to
have to take on board a completely different way of living and
relating to neighbours.
When you live in a flat, you may have people above and below
you as well as next door and along the corridor. With flats,
everybody is interconnected in a way that does not happen with
even the most closely-packed terraced houses, and because of this
there have to be strict rules to ensure that all residents behave in a
responsible and community-minded fashion.
Not only that, but buying a flat is a completely different process
from buying a house.
When you buy a house, you purchase the freehold and that is
that. To all intents and purposes, you own the land on which
your house stands until the end of time, or until you come to sell.
This applies even with terraced or semi-detached houses.
Flats, though, are usually sold leasehold, which means in effect
that you buy a length of tenure, rather than the actual property.
ix