Estates & Management

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PoyntonRed
Posts: 10
Joined: Tue Jun 28, 2016 11:27 am

Estates & Management

Postby PoyntonRed » Tue Feb 20, 2018 8:37 pm

Hi,

I was wondering whether anyone with Leasehold Property in the Poynton area has had dealings with Estates and Management in regard to gaining permission to do alterations to their property?

We have been in our property less than two years so are not allowed to buy the freehold but are concerned that they may hit us with a large charge for permission to do an extension.

I'd be most grateful if anyone has any knowledge of this, we have already had a quote for the Freehold when we are allowed to buy it, which is way more than we expected it to be, so don't know what to expect for permission for renovations.

Thanks

AndrewJ
Posts: 328
Joined: Fri May 28, 2010 12:49 pm

Re: Estates & Management

Postby AndrewJ » Wed Feb 21, 2018 9:35 am

PoyntonRed wrote:Hi,

I was wondering whether anyone with Leasehold Property in the Poynton area has had dealings with Estates and Management in regard to gaining permission to do alterations to their property?

We have been in our property less than two years so are not allowed to buy the freehold but are concerned that they may hit us with a large charge for permission to do an extension.

I'd be most grateful if anyone has any knowledge of this, we have already had a quote for the Freehold when we are allowed to buy it, which is way more than we expected it to be, so don't know what to expect for permission for renovations.

Thanks


We are likely to be doing the same thing this year in a leasehold house, with a different freeholder. The architect we've appointed says that usually it is just a question of telling the freeholder that you are going to do it by sending them the plans once you have planning permission, and giving them a reasonable notice period to respond, beyond which they are deemed to have consented. Normally they don't bother responding, but if they do they might charge a small admin fee (tens of pounds). Our neighbours did this a few years ago and didn't have any problems. So we'll see if that works out. :-)

If you live in a ground floor flat that is a different matter, as of course you don't actually lease the land around the flat, so if you extend you have to buy the land too. This involves legal fees which will be charged to you. The freeholder will also want to appoint their own surveyor who you will have to pay for. The other residents might object to you building on their common land too.

Typically buying a freehold is more hassle than you'd expect and can involve substantial legal costs too. My own leasehold ground rent is only £8 a year, and will remain so for another 940 years. No, I didn't add a zero there. It must cost more to process it than they receive, and for all intents and purposes the freeholder will never be able to use the land. It must be a financial liability rather than an asset, so quite why it is so difficult and extortionate to buy the freehold I'm not sure. You'd have thought they'd be happy to get rid of it.

rafiki6
Posts: 420
Joined: Tue Oct 06, 2009 9:40 am

Re: Estates & Management

Postby rafiki6 » Wed Feb 21, 2018 8:50 pm

They're not anxious to sell the freehold because they own it at no cost to themselves. Ask yourself why they were created in the first place, often by major housing builder like Wimpey. To build on their land you should have the their permission. They can give you permission or sell you the freehold. If you extend without their permission then you can be charged a high fee for not doing so. That's why many freeholds have been sold on, en bloc, so that the new owners can make a lot money out of charging for the use of that land for what could be many years. Regarding costs of selling or purchasing, the purchaser will have to bear the cost (he wants the freehold) I bought my freehold for £200 many years ago and saved over £1100 since.
R

AndrewJ
Posts: 328
Joined: Fri May 28, 2010 12:49 pm

Re: Estates & Management

Postby AndrewJ » Thu Feb 22, 2018 11:25 am

Yes, there has been the odd horror story in the national press about people being charged large amounts just to put up a conservatory, and that is why house builders are not allowed to sell houses leasehold anymore. It is also why it is likely that leaseholders will be able to buy their freeholds much more easily and cheaply within the next year or 2, if the Government pull their finger out. It is hangover from feudal times, and some profiteering companies have found ways to make money from leaseholds that were granted within the last 20 years or so.

However bad things don't usually happen (fingers crossed), and in my lease (which I'd better double-check :roll: ) we lease the land and can build what we like, and most of our neighbours have done so over the decades. It is the purpose of the land that the freeholder checks and authorises, rather than the physical buildings on it. They also don't allow subletting, which is presumably why there are so few houses for rent in Poynton.

If you use the handy on-line calculators you can tell roughly how much your freehold is actually worth. Mine comes to about £140! As I say, it must cost the freeholder more to administer the ground rent than it is worth, and is basically a financial liability, so they really should be jumping at the chance to get rid of them. Charging huge amounts for them is just relying on people's ignorance, long leaseholds are not worth that much.

kit123
Posts: 17
Joined: Sat May 07, 2016 7:47 pm

Re: Estates & Management

Postby kit123 » Thu Feb 22, 2018 6:53 pm

Although this doesn't really answer your question, I had a situation with the owners of my freehold, who sent letters asking to be paid by direct debit rather than by cheque.
We refused the offer and continued to send a cheque. This must have incurred costs for them ( postage admin etc. ). We had a letter shortly afterwards asking if we wanted to buy the freehold. The full cost including legal fees was just over £500. We live in the Charlecote area. If you do pay by cheque though you must be sure to send it immediately the rent is due because they have a habit of charging exorbitantly for late payment of the freehold/leasehold bill.

tunny
Posts: 5
Joined: Mon Nov 09, 2015 8:44 pm

Re: Estates & Management

Postby tunny » Sun Feb 25, 2018 1:48 pm

I'm going through a similar process with a different Management Company and Freeholder.

They'll likely try and get as much money out of you as possible. Here's an example of some of their extortionate charges, an extension will be more expensive:

Consent for Minor alterations – £195.00

– Wooden flooring
– Window replacements
– Gas central heating
– Relocation of Boiler/Flue
– Bath to shower conversion
– Satellite Dish
– Addition of Stud Walls
– Fence
– Sheds

Consent for Major alterations – £395.00

– Removal of walls
– Conservatory
– Porch extension
– Parking bollard
– Driveways
– Stair lift
– Solar Panels

AndrewJ
Posts: 328
Joined: Fri May 28, 2010 12:49 pm

Re: Estates & Management

Postby AndrewJ » Mon Feb 26, 2018 12:11 pm

Sounds to me like a lot of freeholders are taking the micky and I don't think all are like that (hopefully!).

But I still wonder how they make any money, even by trying to force people to ask permission for things that are essentially redecorating or gardening. How would the freeholder even know about such things and how would they know whether it was the current 'tenant' or someone before who had done it, without spending considerably more on the investigation than they would receive in 'fees'? How would they enforce it? In a Small Claims Court they'd have to pay their own legal fees, is it really worth the time and money of pursuing it?

If a freeholder does try to charge a lot even for doing basic maintenance jobs like replacing old windows or driveways, let alone actually improving the house, then surely the leaseholder just wouldn't bother and would move house if necessary? Certainly I'd do that if someone tried to do that. So therefore the freeholder wouldn't get any income from charging for alterations, plus the value of their freehold would fall because the house on it would need lots of renovation. And if the leaseholder is improving the value of the house (and therefore freehold), why charge a fee that is likely to dissuade them from doing so?

Anyway, logic doesn't seem to be my strong point when it comes to financial stuff. Probably why I'm so poor. :-)

AndrewJ
Posts: 328
Joined: Fri May 28, 2010 12:49 pm

Re: Estates & Management

Postby AndrewJ » Mon Feb 26, 2018 12:45 pm

kit123 wrote:Although this doesn't really answer your question, I had a situation with the owners of my freehold, who sent letters asking to be paid by direct debit rather than by cheque.
We refused the offer and continued to send a cheque. This must have incurred costs for them ( postage admin etc. ). We had a letter shortly afterwards asking if we wanted to buy the freehold. The full cost including legal fees was just over £500. We live in the Charlecote area. If you do pay by cheque though you must be sure to send it immediately the rent is due because they have a habit of charging exorbitantly for late payment of the freehold/leasehold bill.


Sounds about right for a long freehold value including legal, in my opinion. I certainly wouldn't want to pay more than that. And it kind of illustrates my point about the freehold being a liability, if selling it cheaply is better value than processing 2 cheques a year. They just wanted rid of it.

I also pay by cheque still. We frequently receive the ground rent demand after the repayment date is due, with the printed date being several weeks prior. Somehow manages to take about a month between printing and us receiving it. :-) They often take at least a month to send us the receipt too. The record being 10 weeks. Almost comically inefficient and costly. Won't be long before I'm paying more in postage than in rent either.

rafiki6
Posts: 420
Joined: Tue Oct 06, 2009 9:40 am

Re: Estates & Management

Postby rafiki6 » Mon Feb 26, 2018 6:05 pm

When a property is sold and transactions handled by a solicitor/legal administrator, it is their responsibility to make sure that any chief rent has been paid up to date and the obligations therein. Omission to do so leaves them negligently liable (maybe hard to prove if done verbally). That's why companies will buy up chief rents hoping to catch out the ignorant of these facts. With my earlier comment, when I told my accountant, many years ago when I was buying a new house, HE asked me if there was a chief rent (which I bought) My understanding of chief rents etc. comes from transactions of a relative.
R

Exonian
Posts: 3
Joined: Sat Nov 19, 2016 9:15 pm

Re: Estates & Management

Postby Exonian » Wed Feb 28, 2018 7:13 am

Anecdotally we heard of horror stories about E&M. We purchased our freehold over 5 years ago and it cost us £1,000.

When I investigated, E&M had even been mentioned in the House of Commons.

One thing to watch out for (if they still do it) is not to fill in the questionnaire they send you each year with the bill that asks about whether you have any changes such as .......... Again anecdotally I have heard that people have been charged retrospectively.

If you read the lease there are lots of restrictions that I suspect most people will deviate from.


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