A lot of First Time Buyers first home will be an apartment - and it can be a great first option for getting on to the housing ladder, but there are some things you need to know. Find out our top 10 questions to ask when it comes to buying an apartment:
Freehold property is one where you own the home and the land on which it is built, whereas a leasehold is where you buy the right to occupy a property that you share in some way with someone else. Flats are leasehold because you share a building with other people, as are all shared ownership properties, which you share with a housing association. The lease is the agreement between parties, which needs to be checked by a solicitor, making leaseholds more legally complicated (and costly) than freehold.
With a leasehold, you’re effectively buying the right to live in that property for a set amount of time, which can be any amount up to 999 years. As time moves on and the lease changes hands, this value reduces, so it’s vital you know how long is left on the lease and a solicitor will check this for you. Mortgage lenders tend to insist that properties have at least 70 years left on their lease so, if you buy one with less than 80 years of lease remaining, you may struggle to sell in five to 10 years’ time. An extension can cost several thousand pounds and take many weeks to deal with, so, if the lease is running out, you should try to push to have it extended before you buy.
You need to know how much ground rent and service charge you’ll pay to live in the property and who is responsible for general repairs of any communal areas, so you can budget accordingly. What exactly do the services charges cover and how often are these costs reviewed? This is a regular cost you’ll have to pay when you move in, so you don’t want it to catch you out later.
Are you free to make any alterations you like to your property, or are there restrictions and, if so, what are the restrictions? These can range from the obvious (you can’t remove internal walls) to more subtle ones, such as making sure you keep the same style and colour of the front door. If you have any big plans for altering the flat, check with your solicitor whether the lease allows those changes. You may need to get written consent from the landlord before carrying out any works.
Your service charges should include costs for general maintenance but might not include costs for potentially major repairs, such as if the roof of your block of flats needs extensive work. If a large repair is needed, you should be aware of who will be responsible and how the costs will be shared? This is important as it may be something you need to budget for in the future.
You’re finally going to have the freedom of your own home, but are you allowed to have pets? In some flats, you’re not allowed to own a dog and in others, you’re not allowed to play music after a certain time of night. Estate agents are unlikely to know all the restrictions that affect a property, so you should ask your solicitor whether there are restrictions that will stop you from doing anything that matters to you.
You’ve most likely looked into the local area and whether it’s got what you want nearby, but what hidden issues are there from its past and what’s planned for the future? Property searches can be ordered by your solicitor and highlight things like whether there’s planning permission for a supermarket over the road, or whether your new home is built on the site of former mines or quarries, which could increase the chance of a sinkhole opening up outside.
In a similar way to when you rent, the landlord owns the property and a separate company often manages it for them. You’ll be dealing with these people regularly, paying service charges to them and asking them to fix any issues that arise, so it’s important to know who you’ll be dealing with. Whether it’s a professional management company, or an individual you’ll deal with, you need to know.
Other costs can arise that can’t be predicted at the start of a transaction. For example, management companies can make extra charges for changing their records when a new person joins or leaves a property, and for administrative fees to provide information you’ll need to get a mortgage. This can add a couple of hundred pounds on to the cost of moving, so it’s worth budgeting for.
While you’re buying, your solicitor will answer your questions but, once you’re in your new home, it’s important to know where you can go for advice. The Government’s Lease Advisory Service has a range of information for tenants and landlords and you can use it before or after you move, to check you know what you need to know.
Visit it at lease-advice.org