Leasehold versus Freehold

Belnavar

While researching about buying an apartment I came across references to a leasehold versus freehold, where you effectively buy a leasehold for up to 999 years, after which time the property ownership reverts back to the freeholder, usually the person who built or first owned the property.

Now, obviously 999 years is around 10 generations and not something to be concerned about for one's current lifetime, but I also heard horror stories about freeholders forcing leaseholders not to alter the property, even preventing them from changing the wallpaper.

Does anyone have more information on this? Are all apartments sold with a leasehold? Can the freehold be bought, and if so how and for how much? What are our rights when it comes to this? Can a freeholder impact on a leaseholder's life in such a manner, even though the property has been bought?

-Bel

delllat

Belnavar wrote: »

While researching about buying an apartment I came across references to a leasehold versus freehold, where you effectively buy a leasehold for up to 999 years, after which time the property ownership reverts back to the freeholder, usually the person who built or first owned the property.

Now, obviously 999 years is around 10 generations and not something to be concerned about for one's current lifetime, but I also heard horror stories about freeholders forcing leaseholders not to alter the property, even preventing them from changing the wallpaper.

Does anyone have more information on this? Are all apartments sold with a leasehold? Can the freehold be bought, and if so how and for how much? What are our rights when it comes to this? Can a freeholder impact on a leaseholder's life in such a manner, even though the property has been bought?

-Bel

in the ifsc apartments they have a detailed contract which doesnt allow a lot of stuff
so its worth checking ,it doesnt mention wallpaper or anything as stupid as that but there are strict rules about not hanging clothes on balconys and sattellite dishes are not permitted

bikes /prams /umbrellas/shoes are not allowed to be left outside your apartment door in the complex ,smoking and pets may not be allowed in the cooridors /complex

the management company can issue warnings for almost anything they deem to be anti-social or unacceptable

in reality though they never bothered us but some companies could be worse than others

Dubsey

Hi Bel,

while recently trying to purchase a house we found out that it was a leasehold property as opposed to a freehold. Basically, if we had bought the leasehold we would have had rights to use the house but there were a lot of restrictions relartin to use for non-domestic purposes, any modifications, etc.

This was a show-stopper for us so the vendor went about trying to resolve it. In our case, the lease was for 999 years and the ground rent wasn't paid for donkeys. The current company which owned the leasehold were happy to waiver any claims and it was going to cost around €400 to buy the freehold.

we ended up walking away for a separate reason but there is plenty information online on the matter on the Property registration's website.

I thought that apartments were all leasehold due to their nature (i.e. part of a larger building) but hven't looked into it.

D.

Victor

I can't imagine an apartment being anything, but leasehold. However, what you want to make sure is that you are also buying a share in the company.

Belnavar

Thanks for the responses and information, guys.

Victor, can you tell me more about this share? What percentage is average?

-Bel

Paulw

Belnavar wrote: »

Victor, can you tell me more about this share? What percentage is average?

Each unit holds 1 share of the management company.

All conditions should be clearly laid out in the Lease Contract and in the Articles of Association for the management company.

jmb1

Hi,

I was asking myself the same questions, in particular :
Are all apartments on leasehold ?
Is it possible to buy the freehold for an apartment ?
How much is the leasehold rent ? In which conditions can it be revised ?

Thank you very much

P. Breathnach

The notion of an apartment in a multi-storey block being held on freehold is a bit of a nonsense, because the essence of freehold is that you own the land on which a structure stands and the air above it. That's simply not feasible if your apartment is on the third floor of a six-storey block.

The way things are moving now (because of the MUD Act) is that the apartment holders as a collective in a management company can own the freehold, and each individual owner leases an apartment from the company in which he or she is a member. It's rather similar to a co-operative.

Procrastastudy

It is possible to buy an apartment Freehold. It's whats known as a 'flying freehold'. Although the Law on Land is very different in Scotland this is the norm there. Ireland follows the English model (again quite different Land Law) in that most apartments are Leasehold. That said I've never seen a Freehold apartment in Dublin.

Freehold apartments sound good in theory but what happens if the block burns down and the guy under you wasn't insured and is living in Australia? You've nothing to build on. What happens if the roof caves in and half the owners don't have the money to pay for the roof? To be fair my maintenance fee in Kirkcaldy was £30 a year for one of the old lads to mow the grass a few times a year and we all cleaned our own landings.

jmb1 wrote: »

Hi,

I was asking myself the same questions, in particular :
Are all apartments on leasehold ?
Is it possible to buy the freehold for an apartment ?
How much is the leasehold rent ? In which conditions can it be revised ?

Thank you very much

Generally yes.
Generally no.
The lease is bought for the cost of the apartment - you only pay a yearly 'management fee' which is not the same as paying rent. Leases are typically the remainder of 200 years. Revising a lease for an apartment block is damn near impossible, it's also damn near impossible to 'evict' someone who 'owns' an apartment.

Lantus

Belnavar wrote: »

While researching about buying an apartment I came across references to a leasehold versus freehold, where you effectively buy a leasehold for up to 999 years, after which time the property ownership reverts back to the freeholder, usually the person who built or first owned the property.

Now, obviously 999 years is around 10 generations and not something to be concerned about for one's current lifetime, but I also heard horror stories about freeholders forcing leaseholders not to alter the property, even preventing them from changing the wallpaper.

Does anyone have more information on this? Are all apartments sold with a leasehold? Can the freehold be bought, and if so how and for how much? What are our rights when it comes to this? Can a freeholder impact on a leaseholder's life in such a manner, even though the property has been bought?

-Bel

Apartments are based on a lease for a number of reasons. Typically there will be a managment company who will own the building, the walls and roof and the main structure and common areas. You will buy the insde layer of plasterboard on a property and a right of access. That is 'technically' what you own.

The management company as owner of the structure then is able to effect repairs and upkeep as required without having to worry about trespass. Practically how could you expect someone to say paint the outside walls of their apartment if they are on the 9th floor? Or clean their windows?

To pay for this owners pay an annual service fee which will vary depending on the services provided. It can be anything from 900 to 3 thousand per year and legally you must pay it or be potentially taken to court or have your car clamped or restricted access to common areas.

please research this before you buy and enquire as to what this fee is.

The ODCE provide a great guide on management companies. You could also try loooking up the company on the cro.ie if you know its name and get its accounts for a few quid.

Kosseegan

Lantus wrote: »

To pay for this owners pay an annual service fee which will vary depending on the services provided. It can be anything from 900 to 3 thousand per year and legally you must pay it or be potentially taken to court or have your car clamped or restricted access to common areas.

There is no lower limit 0f €900 or upper limit of €3,000 per year.