Leasehold Conveyancing in London – A Warning for purchasers of ex-council flats

  • Councils are being required by the Government to update their properties
  • Owners of flats in blocks owned by Councils have to pay a share of the cost
  • Bills for these works can exceed £20, 000 per flat 

If the flat which you are purchasing is a former Council property originally purchased by a former tenant under the ‘Right to Buy’ legislation and the Freeholder (Landlord) is the Council, or a company wholly owned by the Council. In most such cases there will be other flats in the building which will be let by the Landlord to Council tenants.

Private owners of flats in blocks still owned by a Council are required under the provisions of their leases to contribute not only to the costs of day-to-day maintenance and repair of the block (‘Service charge’) but also to the costs of major repairs and renewals of the structure of the building, including the services and windows. This may also include costs in improving the building.

Councils are now required by the Government to carry out extensive major works to their residential properties to bring them up to certain standards imposed by the Government. This means that Councils ( London and throughout England and Wales ) now have programmes to upgrade all properties they own, and they either have or will be carrying out such works, in many cases involving works estimated to cost very substantial sums, during the next few years. The cost of such works will be charged to flat-owners – for example, if major works to a building containing 50 flats cost £1 million, then each flat-owner would be have to pay £20, 000. Of course only the owners of flats which have been privately purchased have to actually pay, as the Council will pay the share of the costs attributable to flats which are let to council tenants.

Where you require conveyancing in London or elsewhere in England or Wales the property is a former council property your conveyancing lawyer should make enquiries as to works carried out or already planned, and will advise you about this. If it is anticipated that a bill will be received from the Council after contracts for the purchase have been exchanged we will require the Seller’s conveyancing solicitors to pay this at completion, or retain money to pay afterwards. If works are planned but have not yet been completed, we will inform you so that you can consider negotiating a reduction in price. The Fridaysmove London Conveyancing team are experienced in this area.

However Councils are often unable (or unwilling) to give information about future plans, and sometimes works which were not previously planned are found to become necessary at short notice. Therefore no guarantee can be given that you will not receive a notice of the Council’s intention to carry out major works after you have purchased the property, and from the date of completion you will be liable to contribute to the cost of all works carried out by the Council in accordance with the provisions of the lease.

Your conveyancer can only pass on such information as is provided by Sellers and the Council, and cannot be responsible for misleading or inadequate information supplied by them. If you have any questions about exposure to major works as a result of conveyancing in London where you are buying an ex local authority property please speak to one of our conveyancing in London team.

 

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