I bought a flat for £12,500 cash (no mortgage) in Kidderminster about 4 years ago.  It was in a bit of a mess when I saw it hence the price.  So when I acquired it I requested the keys from the agent.  The agent gave me what they had but they said I will need to get a fob from the freeholder to get past the electric security on the flat.

When I asked the freeholder for this fob they said to me I could get a temporary one that will last 14 days.  I had to keep renewing the fob until I had submitted them the eventual tenant’s name once a tenant had been found.  Considering I had to refurb the property and then market the property to find a tenant I knew I had to renew the fob at least 4 times.  To put it bluntly – I couldn’t be bothered!  The flat had cost me next to nothing so I lost interest in the flat……

3 years pass and I think I must sort this flat out.  I wrote to the freeholder asking them for a service charge demand as I had never received one before.  No response.  I phone them – it goes straight to answer phone.  I’m starting to lose interest.  So I scan the internet to see what these flats are going for.  To my surprise there going for around £30,000 to £35,000!

So I think to myself, let me chuck it in the auction and try and get double my money back.  So I entered it in the auction.  I started to get offers on it in excess of £25,000 before it has even entered the auction.  But then my solicitor rings me up and says – “the lease is NOT in your name!”  He then traces it back through landreg and it showed that the freeholder had forfeited the lease 2 years ago for non payment of ground rent.  They had served all paperwork to the property address and not my home address.

After a lengthy solicitor and barrister exchange of letters costing me £1,000 it is decided I will not stand a chance in court to get my flat back.

The message of this story is:

1. Do not forget about your leasehold flats!  Visit them or get someone to visit them.
2. If you buy a leasehold flat remember that they can be snatched back off you.  This would never be the case if you own a freehold property.
3. try to get a mortgage on a leasehold property.  This way their interest is noted and if the freeholder cannot contact you they will make contact with the lender as they have a financial interest in the property.

I am glad this happened to me on just a £12,500 flat.  I am annoyed but just imagine if it happened to a flat worth £125,000...
 

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Posted on: 26th Feb 2008