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Good freehold management has a place to play given this countries rather ancient leasehold / freehold system but for me most freehold companies are right up there with credit card companies, loan pushers and bookies as an evil but legal form of cash extraction.


I let out a flat which I own on leasehold and we've always paid our bills (ground rent, buildings insurance etc) on time to the freeholder.


But in the past few years I've seen an increase in all kinds of charge: an unnecessary asbestos search report, fire extinguisher installation (in an ED terrace!) and today...best of all...?132 and five people to change a communal light bulb (I kid not).


When I lived there I just used to change the tube myself ?10 from Plough DIY.....


Yes there is the old Leaseholders Advice line you can call but.... all of the scenarios above were deemed legally "fair and reasonable". It seems I'm not allowed to change a light bulb on the communal staircase between two flats unless I'm a qualified sparky and have full public liability insurance and kicking up a fuss just gets me lawyers letters and penalty fines. If I took it to court I'd lose.


It's evil and the blight of freehold management companies needs to be destroyed and removed from this fair country - when will the law change?

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https://www.eastdulwichforum.co.uk/topic/23166-the-evil-business-of-freehold/
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We missed a trick back in 2002 when we all bought the 3 flats together and the small time developer offered to sell us it for ?5k. We tried to knock him down to ?3.5 to offset some snags that needed correcting from the purchase. He replied he was doing us a favour and stuck it in at Auction....which we went along to and watched it go for ?11k.


A valuable lesson learned - always know the true value of an asset before you start haggling over it. We didn't know it was a bargain versus its true market value.


I reckon it would cost us about ?15k to buy it back (inc legals) and save us ?500 per year each so we'd have to hold for 10 years to get a return....unless it actually does add a premium on sale. I'm not convinced about that. They have 120 year leases so I don't think freehold versus long leasehold makes much difference to a buyer?

It should make a differnce in value- it does in Central London. If you have an informed estate agent they should recognise this fact. Some depends on what ground rent and service charge you pay now. If you have 2 identical falts for sale - one freehold and one paying ?500 pa ground rent- then technically the freehold one is worth circa ?10 k more. Then if the leasehold has a high service charge ( ?120 light bulbs add up) of saY ?1000 per flat- but you can show you have improved the management costs- but not at the cost of dropping maintetnace/ sinking funds - then this should add value too. However if the potential buyers are uninformed and particularly the local agents then this will not always be picked up.
What WOD said...I believe having a share of freehold also increases the saleability of a property, something you can't put a tangible monetery value against. And as you've found out with the light bulb incident, being in control of how things are run also has a non-monetary value in that you're less likely to get stressed out ;-)

Annette Curtain Wrote:

-------------------------------------------------------

> You let it go for a measly ?1,500

>

> Oh dear, what a dope.

>

> (but you know that don't you:()


Yep. But back then I had less than nothing. I bought my flat with a 10k deposit cobbled together from a credit card and a bank loan. I remember getting the keys, opening the front door and realising I couldn't afford any furniture. I slept on a blow up mattress for 3 months and washed my clothes at Underhill Road laundrette. Great feeling though managing to buy your first place...

I would say the freehold would be worth more than ?15k (three units and sold for ?11k in 2002) - they are fairly nice low level investments. We did a lease extension (to a virtual freehold) fairly recently for around ?15k on a one bed - legal?s were around the ?600 mark.


But as with all leasehold properties it is dependent on ground rent/ service charge / lease length / property type / value and the many unknowns only surveyors seem to understand. If you do decide to go down the route ensure you get a couple of surveys and make sure the surveyor and solicitor doing it is local or knows the area.

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