- What does leasehold mean?
- What is a lease?
- What are my contractual rights?
- What are my responsibilities?
- What are service charges?
- What repairs and improvement works could be included in my service charge?
- What other charges are included in my service charge?
Leasehold ownership is simply a long tenancy, the right to occupation and use of the flat or maisonette for a long period, i.e. the 'term' of the lease. The term of the lease is usually for 125 years and is fixed at the beginning and will decrease in length year by year. The flat or maisonette can be bought and sold during the term.
When you purchase a flat or maisonette you are buying the right to occupy part of a larger building. The ownership of the flat or maisonette relates to everything within the four walls, including floorboards, plaster to walls and ceilings, but does not usually include the external or structural walls and roof. The structure and common parts of the building and the land it stands on are owned by the Council, who is responsible for its maintenance and repair.
A lease is a contract between the leaseholder and the Council giving conditional ownership for a fixed period of time, i.e. the term.
The lease sets out the contractual obligations of the two parties; what the leaseholder is contracted to do and what the landlord is bound to do.
Common terms used in the lease include:
Leaseholder or Lessee: The owner of the flat or maisonette
Lessor: The Council
Demised Premises: The internal shell of the flat or maisonette which you have brought
The right of occupation of the flat for the term of the lease. In addition, the leaseholder has the right to expect the Council to maintain and repair the building and manage the common areas - that is the parts of the building or grounds not specifically granted to the leaseholder but to which there are rights of access, for example, the entrance hall and stairs.
To keep the flat in good order, to pay on time a share of the costs of maintaining and running the building, and abide by the terms and conditions specified in the lease.
Service charges are payments by the leaseholder to the Council for all the services the Council provides. Service charges cover the owners share of the costs incurred by the Council in the managing, maintaining, repairing and improving of the structure and communal areas of the block to which the purchased dwelling forms a part.
Service charges can vary from year to year. They can go up or down without any limit other than they are reasonable.
Details of what can and cannot be charged by the Council and the proportion of the charge to be paid will be set out in the lease.
Day-to-day repairs may include for example, repairs to staircase lighting, refuse disposal systems and door entry systems. These are repairs that are not planned but are done when the Council is notified there is a problem. This type of work is called a 'responsive repair'.
Occasionally more substantial work will need to be done to your block, such as major roof repairs, full window replacements etc. This type of work is call 'major repairs'.
Such work is planned in advance and is prioritised and planned by the Housing Department. We will advise you before any major work is started and ask for your views.
Programmes of work are reviewed regularly and are subject to change depending on priorities and finance.
As well as service charges, you will also receive charges for building insurance and ground rent. You will need to arrange your own contents insurance to insure your belongings.