Flats and Major Repairs

[Anon Private]

Hello,

I know that if I buy a leasehold flat that I will pay service charges, that cover things like the maintenance of the grounds; but, what if something major needs attention, for example, the roof needs repairs or the plumbing or electrical systems need attention?

How are these events financed (there may not be a reserve fund, and even if there is, it may not be sufficient).

When someone moves into a leasehold flat what contributions could they be liable for if there is a reserve fund, or no such fund. How are these arranged? I am having difficulty in obtained copies of leases at an early stage.

Assume a large block of flats. Some flats probably have tenants.

Thanks

UK (England) resident

 

[realdeals]

If you are not able to get a copy of the lease at an early stage this would set alarms bells ringing slightly for me. Everything will be set out in the lease agreement so I would not take anything for granted.

 

[Nicholas Wallwork]

Yes as @realdeals states the lease should detail all of this... ultimately if there is no reserve fund (left) then the cost is usually shared between the owners of all the flats in the building and I'm sure the lease will state that.

Get hold of the leases and let your solicitor advise on it... that's a MUST.

Good luck, I hope it works out!

 

[menachem]

I remembered from the article the I read. If there is no reserve fund then the cost of work will be shared by owner and individual leases.

 

[Anon Private]

Thank you all for responding.

Regarding the lease. You are right in saying that it is a good idea to see the document at an early stage. My recent experiences have taught me that agents tend not to have a copy of the lease, and even if they say they will obtain a copy, they do not contact me.

It should be made easier for prospective buyers to see a lease. It is, of course, available at a later stage and with the solicitor.

My understanding of the reserve fund and payments is now that this fund tends to be built from what is left over from the service charges. In the event of repairs needing to be carried out that exceed this fund, then the leaseholders and other owners will be charged for the outstanding balance. It is my understanding that the payments would be charged pro rate and based upon the floor area of the flat. I wonder if balconies are included, etc.

Best wishes to all