Our Customers Love Us!

Block of Flats Insurance

Get a Quote.

Choose from our range of insurances below

HomeProperty InsuranceBlock of Flats InsuranceBecoming A Landlord

Becoming A Landlord

The Decision to Become Your Own Landlord

The desire, to own a partial share of your freeholder is strong in almost all owners of leasehold flats. It’s all about control and knowing that your home or investment property is not just yours for a determinable period of time, it’s yours in perpetuity, you want to own not only the right to occupy your portion of the building for this period of time but also have a share in the fabric of the building and the actual land on it which it stands. Leaseholders do not own the fabric of the building in which their flat is located, nor do they own the land on which the building stands. They own the right to occupy the self contained area of the building as defined by their lease for the set period of time in return for a sum of money and an annual rent ( usually called ground rent. The leaseholder is free to sell his lease to another party. As well as the feeling of security obtained by actually knowing you own the bricks and mortar, importantly, more control can be obtained over the running of the building in particular relating to the ‘service’ costs.

Lease holders of blocks of flats are usually presented each year, with a list of service charges from the freeholder which are often contentious. The largest part of the service charge usually relates to the arrangement of buildings insurance for the block and it is in this area that most problems start. Often a few quick calls to a broker or insurer that specialises in this type of insurance, reveals that more competitive quotes can be obtained. Frustration then sets in when the leaseholders discover that the freeholder is responsible for arranging the insurance and that he is reluctant or unwilling to allow them to reinsure elsewhere and save money.

The desire to save money on insurance is one of the key issues as to why groups of flats owners decide on a course of offering to buy the freehold from the landlord or ‘Enfranchisement’ a term use for the right to collectively compel an unwilling landlord to sell you the freehold of the building. Some of the problems experienced with landlords include the following;

  • Charges appearing for things which are not specified as being chargeable in the lease and being unable to obtain an accurate breakdown of the charges.
  • Insurance premiums which seem higher that can be obtained elsewhere.
  • Inability to be able to see the insurance policy or schedule of insurance and worry that the building may not be correctly insured if at all.
  • Maintenance charges that appear to be excessively high.
  • A lease that is not clear whom is responsible for repairs.
  • Service charges which appear to be out of proportion with the work done.
  • Completed work which is poorly carried out, left uncompleted or simply not carried our at all
  • Problems with being able to contact the landlord easily or as is sometimes the case, the landlord completely disappearing.
  • Problems with the landlord not wanting to discuss alterations or extensions to the leases

Can we Buy our Freehold?

The passing of the leasehold Reform Housing and Urban Development Act in 1993 gave leaseholders the right of enfranchisement to buy their building. This collective right to buy is known as ‘collective enfranchisement’. In able to be able to make use of this Act in pursuit of your freehold, you have to make sure your ‘qualify’ The qualification applies to collectively purchase the freehold with the other flat owners.

  1. The building must qualify in it’s own right. The building and premises must contain two or more flats which must be self contained ( have their own lockable entrance). The freehold of the self contained units must be owned by the same person. At least two thirds of the flats in the building must be qualifying flats. No more than a quarter of the building should be used for non residential use.
  2. A tenant ( leaseholder) must have a lease with at least 21 years to run before it’s contractual end date. ( leases in excess of 21 years are defined as long leases.) Each flat can only have one qualifying tenant, so if you own the flat jointly with your partner for example, you will count as one owner. If you are part of a shared ownership scheme, you will need to check if you qualify as you may be ineligible unless you own 100% of the equity in your flat.
  3. Leaseholders from at least 50% of the flats are required to participate in the collective enfranchisement.
  4. The property in question must be subject to a low rent ( usually called ground rent). If your lease started before 01/April/1963, then the ground rent must be not more than two thirds of the letting value of your flat on the day the lease started. For leases granted after this date, but before 1st April 1990, the ground rent must not be more than two thirds of the rateable value of the flat on the day the lease began. Finally, for leases granted after this date, two groups are used. In Greater London, the ground rent can not exceed £1000.00. outside of this area it is £250.

Initially there are no residence qualifications relating to the flats, thus if you use yours as a holiday or second home or as an investment ( buy to let insurance) this will not make any difference. However & importantly, at the notice stage of the proceedings, the residency condition becomes more defined. A leaseholder will achieve the residency condition if he or she has used the flat as his or her principle residence for the last 12 months or for periods totally three years in the last ten years. There are some exclusions to qualification, if a tenant owns more than two flats in the block, he or she will cease to qualify. If the building has a landlord that is in residence and there are no more than four flats in the property, then no enfranchisement can take place. If the building itself does not qualify but all the leaseholders do, then you may be able to obtain an extension to your lease. As with all matters relating to purchase of a freeholder or modification to a lease, professional advice should be sought from a solicitor.

Latest News & Advice

Britain needs more Flats

Britain needs more Flats

We can trace the need to convert houses (including other buildings, not originally designed to be used as domestic dwelling homes) in to flats, back at least 150 years and possibly even further back to the time of the industrial revolution, which occurred in Great Britain during the late eighteenth and early nineteenth century....

Valuing Freehold Interest

Valuing Freehold Interest

If you are interested in buying the freehold of your block of flats, you will need to know, how much it is likely to cost you. Having this information to hand for all interested flat owners, before you proceed too deeply in to negotiations is a must...

Residents Newsletter ideas

Residents Newsletter ideas

If you live in block of flats, whether, enfranchisement has been achieved or not, setting up a residents newsletter can be good idea. As well as bring to the attention of other residents, the latest news with regard to the block, the issue of a news letter can help to foster a feeling of a community...

I want to insure...Hide X

    Get a Quote