A Management Pack which is often known as ‘Sales Pack’ containing a set of forms and documents relating to the sale of the property where a service charge is paid to a specific Management Company who maintain shared facilities especially in the cases of flats and apartment blocks. For example, the pack will include the following:

In all leasehold transactions and occasionally in freehold transactions where there is a Management Company involved, the seller will be responsible for providing the Management Pack to the buyer’s solicitors for review and is payable by the seller. It is not a legal requirement to provide the pack to the buyer’s solicitors however the buyers solicitors nor the buyer may wish to proceed with the transaction without having a review of the pack as it does include vital information which they will be required to report on to their clients due to due-diligence and compliance.

It is crucial to understand that the management pack may be required when selling a freehold property also, this is often the case where the property is a new build and is part of a larger development where the owners are responsible to contribute towards the upkeep and maintenance of the common areas such as car parking, footpaths, and any other open spaces. The details of the Management Company are usually set out within the Title Deeds under the restrictions section.

The pack will also include any requirements and fees payable to the Landlord or management company for the transaction to proceed. There may be a fee to provide a certificate to comply with a restriction on the title against selling the property without the consent of the management company.

The cost of the pack will depend on the Management Company, each Management Company have their own fee and the prices can vary between £100-£500 and is usually produced within 2-4 weeks once it has been paid for therefore it is important that this is requested at the early stages of the transactions avoiding any further delays. However, some Management Companies offer an additional charge to expedite the pack. Once the buyer’s solicitors had a review, they may wish to raise additional enquiries with the Management Company for further clarification.

You can contact our Conveyancing team here or call on 01604 936512 / 01908 953674 or email info@franklins-sols.co.uk.

 

Typically, in the cases of flats and apartments, there will be management companies who will be involved with managing the services for the apartment block. Each leaseholder (flat owner) will need to pay for the services provided by the management company in the name of service charges.

However, there is a common misconception that these management companies apply for leasehold properties only; there can also be management companies for freehold properties.

There are two ways in which management companies can be created; one, the developer will create the company and then will appoint managing agents to provide the services. However, in cases of smaller developments with a few houses, the individual owners may take a share in the company and collectively run it.

The details of the management company can be found within the title deeds to your property and they will be responsible for maintaining common areas such as footpaths, open spaces, car parking areas, etc. Each property owner will be required to make contributions for these services in the form of service charges.

Will this impact the sale of my house?

Properties with management companies is becoming increasingly common and therefore it should not affect the sale of your property. Although, this does mean that additional paperwork will be involved.  If the property that you currently own has a freehold management company involved, you will need to obtain a Freehold Management Pack (also known as FME1) which will include vital information such as the total service charges (including the likely increases), the details of who organises maintenance arrangements for the shared areas/amenities, payment history, budgets, any fees that your buyer may be expected to pay post-completion, etc.  This pack will then need to be provided to your buyer solicitors for review.

No two management companies are the same and therefore the costs for these packs can vary and the timescales to issue them from the receipt of payment can also vary greatly. Therefore, for the smooth running of your transaction, it is important that this management pack is requested at the outset of the transaction to avoid any delays.

For further advice and assistance please contact our Residential Property Team on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk

 

A Leaseholder of a residential property is entitled to extend your Lease providing certain criteria are met including the following:

  1. They have owned the property for no less than 2 years;
  2. The original Lease was granted for a period of no less than 21 years.

As a Leaseholder this right is important because the more the term of the Lease decreases, so does the property value.

Whilst many Leaseholders are successful in agreeing an extension with the Freeholders amicably either informally or following service of a Section 42 Notice, unfortunately disputes or circumstances can arise where an application to the First Tier Tribunal Property Chamber (“the Tribunal”) becomes necessary. For example if the parties are unable to agree on the premium payable or the Freeholder simply fails to co-operate or engage in the process.

Once an application to the Tribunal has been made, the Tribunal will either decide the terms of any new Lease, including the premium payable, on the papers filed, or a final Hearing will be listed in order for both parties to present their case.

After considering each party’s case and providing the Tribunal is satisfied that the Leaseholder meets the criteria required to entitle them to an extension, it will grant an Order setting out the terms upon which the new Lease is to be granted. If either party then fails to complete the new Lease incorporating these terms within two months of the Order being granted, a further Application can be made within 2 months to the Tribunal to enforce the Order.

If you have been unable to agree an extension with your Freeholder please contact our Dispute Resolution Department for information about our fixed fee services for Tribunal applications on 01604 828282 / 01908 660966 or email litigation@franklins-sols.co.uk.

The government has recently announced that it will introduce a ban on the sale of new houses as leasehold, with new build houses to be sold on a freehold basis except in the most extraordinary circumstances. Ground rents will also be reduced to zero for any new leases entered into.

Communities Secretary James Brokenshire stated “We have long recognised that we have a responsibility to confront unfairness in the leasehold market”.

“We will legislate to ensure that in the future – save for the most exceptional circumstances – all new houses will be sold on a freehold basis. We are committed to taking bold action to reform the sector and will be pressing ahead as soon as parliamentary time allows.”

The new policy is in response to widespread criticism of the leasehold system of property which has left many homeowners unhappy with rises in the ground rent and service charge demanded by the freeholder, and that such charges have affected their ability to sell their property. The changes brought in however will only affect new build properties, and there is yet to be any comment from the government about reform to the leasehold system for existing properties.

For advice and assistance in selling your leasehold home, please contact our expert Residential Property team on 01604 828282 / 01908 660966.