Selling a flat, freeholder taking the p**s

[nitrodave]

megaphone said:

So if you own a share of the freehold, why can't you fill out the form? Who is the 'freeholder' you are asking to fill it out? Surely they are just a joint freeholder as well?

Just inquisitive how all this works.

Having a share of freehold means any maintenance and upkeep is decided amongst us and the cost shared, rather than pay a management company and not be able to see how and when our money is spent.

Legally all flats must be under a leasehold status. In our case the land freeholder still collects ground rent. The forms he has to fill out for our sale basically amount to him ticking a box to say we are not in arrears with ground rent.

Having been a leaseholder paying a lot of service charges and shared freeholder who only pays out when something needs doing, I can tell you the latter is far better. I get to choose who does work and only pay when work is done. I am only required to be reactive to things when they are needed and not pay monthly charges and see nothing for that money.

Some more info can be read up on here: http://www.in-deed.net/share-freehold-conveyancing

[megaphone]

Thanks, still confused, I thought a share of freehold meant you owned an equal share of the land and building, there is no longer a single 'freeholder'. No one to pay ground rent to etc. Or are there different levels of 'share of freehold'?

[snorky782]

I'm equally confused amd I think he OP is confusing himself too

I think what he means is that someone else owns the whole freehold and he pays them ground rent.

The three people living within that freehold have agreed a process whereby they just pay 1/3 of all maintenance / general bills as and when they arise, rather than set up their own Management Company into which they pay a monthly service charge.

I don't think the OP owns any of the freehold at all.

[nitrodave]

It sounds confusing, I know, but it is a share of freehold so we jointly own the building, but not the land.

[snorky782]

nitrodave said:

It sounds confusing, I know, but it is a share of freehold so we jointly own the building, but not the land.

The freehold is the land and not the building though

Freeholder gets paid ground rent. In other words the rent for the land that the property sits on

The management company (or those who live there in agreement) pay for the maintenance and bills on anything in a any communal area in the form of a service charge, or just as amd when bills crop up. This has nothing to do with the ground and the freehold.

[surveyor]

It is very unusual to share the ownership of a freehold in this scenario. Far more usual for a limited company to own the freehold, and each flat owner to have one share of the limited company.

The limited company may or may not appoint a management company - or may sort it out amongst themselves.

I've also come across reverse freeholds - usually only with two apartments. One owns freehold of the other, and grants a long lease to said other and vice versa.

[Wings]

surveyor said:

It is very unusual to share the ownership of a freehold in this scenario. Far more usual for a limited company to own the freehold, and each flat owner to have one share of the limited company.

The limited company may or may not appoint a management company - or may sort it out amongst themselves.

I've also come across reverse freeholds - usually only with two apartments. One owns freehold of the other, and grants a long lease to said other and vice versa.

In my case I am one of six leaseholders, each leaseholder having one share in a Limited Company, the same that either appoints a Management Company or as we do Self Manage. Service Charges are collected twice yearly from Leaseholders/Directors, with repairs, gardening and building insurance costs being paid from the service charges. Self Management creates considerable financial savings, the same that goes towards the fabric of the building.

[Ken Figenus]

surveyor said:

It is very unusual to share the ownership of a freehold in this scenario. Far more usual for a limited company to own the freehold, and each flat owner to have one share of the limited company.

The limited company may or may not appoint a management company - or may sort it out amongst themselves.

This - and there is understandably a lot of confusion here - the whole area is a mess.

One example: A chap was selling his flat in a small block and had equal shares to me in the freehold as we'd clubbed together to ditch a dodgy freeholder/management co (YES all-in-one Snorky!). Us as freeholders then assigned ourselves 999 year leases on the flats (as no one will mortgage a freehold flat) but he was then asking me to do paperwork for his purchaser a few years later and learn how to issue share certificates etc. I'm going 'do it yourself' as we have equal shares or I will charge you for my time/research/neck! But he needed me to do it as buyers solicitors didn't like him doing it himself...

Very odd area and have now been through that many times! I'm the freehold company sec and a director on one unit and feel pretty secure in that and treat the others honorably as long as they too are honourable and pay their insurance and maintenance, but I can see how it could be abused... Slack area...