First steps: Should I buy a house or a flat? Are there different laws?
Whether you buy a house or a flat depends as much on what you can afford and what is available for sale, as it does on your personal preferences and requirements.
FLATS MEAN SHARING
If you don’t like sharing stairs, entrance halls, bin stores and so on, a flat may not be for you.
Most flats are leasehold and, should you buy one, the terms of the lease will set out the landlord’s obligations and also your obligations as the lessee.
It is important at the outset to establish basic facts about the flat and the management of the building it is in.
During the conveyancing process your solicitor will obtain a considerable amount of detailed information but before you commit to buying, you should find out:
- How many years the lease has left to run — ie the unexpired term.
- The current ground rent and service charge payable and how the rent increases during the term of the lease.
- The restrictive covenants — for example, are pets are allowed in the flat? If you have a dog and only find out that dogs are prohibited just before exchange of contracts you could waste time and an awful lot of money.
- Who owns the freehold? And find out about the management of the building. For instance, a flat may be sold with a share of freehold.
This means that the freehold is owned by a company and all the flat owners have a share or are members of the company and so have a say regarding the upkeep and maintenance and repair of the building. You can always ask to see a copy of the lease.
HOUSES COME WITH RULES, TOO
In general, houses are freehold but they may nevertheless be subject to covenants and obligations.
If you intend to refurbish, alter or extend the house, do check whether there are any restrictive covenants in place that might hinder your plans.
If the property is in a bad state of repair, consider the extent and likely cost of the repair works needed and budget accordingly.
Houses can be leasehold and in some areas leasehold houses have been around for many years.
Developers have recently been selling leasehold new-build houses, some of which have ground rents linked to the rate of inflation or which double every five, 10 or 20 years.
This means that the rent payable during the term of the lease can run into tens of thousands of pounds.
This tends to reduce the value of the house on resale. Some mortgage lenders may not want to get involved where there is an escalating ground rent.
Find out about the rent as soon as possible and before you commit to buying. The Government announced a ban on new leasehold houses in December.
WITH A BABY PLANNED, WE NEEDED OUR FIRST HOME TO BE A HOUSE
In one life-changing weekend last summer Sarah and Oliver Brown found out they were expecting their first child — and reserved their first home together.
Their daughter is due any minute and she will be coming home to a new three-bedroom house at Oakley Grange, Crest Nicholson’s development in the village of Headcorn, near Maidstone in Kent.
The couple moved into the £385,000 property in August, which has given them plenty of time to get a nursery ready for the new arrival.
It took the Browns three years to save for a deposit — with a little help from Oliver’s mother — and they also took advantage of the Government’s Help to Buy scheme which meant they “only” needed a five per cent down payment of £19,250.
“Without Help to Buy we wouldn’t have been able to afford to step on to the property ladder,” says Sarah, 32, an area manager for a care company.
The couple could have put their money towards a small London flat instead. This would have been convenient for Oliver, whose job with a market research technology company is based on the South Bank. His daily commute takes an hour and a quarter each way, and his season ticket costs £470 a month.
However, they had resolved to skip the flat stage and aim for a house well before Sarah, who travels all over Kent for her job, became pregnant.
They already knew they wanted children sooner rather than later, and also wanted a home with a garden and plenty of space for family and friends to stay over.
“We found out about the baby the same weekend we reserved the house, so it was all meant to be,” says Oliver. “It was indeed a life-changing weekend.”