What if I’ve bought a leasehold flat?
Buying a leasehold flat at auction is very different from buying a freehold house. With leasehold, you are not buying the building itself, but rather a legal right to occupy the flat for a fixed number of years. The flat is part of a larger building which is often owned and managed by a freeholder (landlord) or management company.
What are the implications?
As a leaseholder, you are typically responsible for:
- Ground rent: An annual payment to the freeholder.
- Service charge: Your share of the costs of maintaining the building, communal areas, and facilities.
- Compliance with lease terms: Including restrictions on subletting, alterations, or use.
- Repairs inside your flat, but not to the structure or communal areas.
The freeholder or managing agent is responsible for the overall management of the building, including arranging buildings insurance, structural repairs, and maintenance of shared areas.
What are the risks when buying at auction?
- The full lease document is often not provided in the legal pack.
- The seller may not supply an LPE1 form or management pack, so you may be buying without knowing:
- The length of the lease.
- The amount of ground rent or service charges.
- Whether major works are planned.
- Whether there are arrears or disputes with the management company.
This means you could be committing to a flat with high costs or legal restrictions without being fully informed.
Summary
Leasehold properties can be complex and expensive to manage. If you’re buying a flat at auction, you need to understand that you are entering into a long-term legal relationship with a freeholder and may face significant financial liabilities. Always check the lease terms and consult your solicitor where possible — even when time is tight.










