can avoid costly pitfalls!
Our client agreed to buy a flat in a charming 1920s house converted into five flats. Under the terms of the lease the landlord was obliged to carry out the maintenance of the main structure (the structural walls, the roof, the foundations, and the common parts being the entrance hall and stair cases) and each flat owner was obliged to contribute one fifth of the cost of carrying out the maintenance.
The purchase price of the flat was £200,000 and, after a survey of the flat and the rest of the house, the surveyor reported that significant repair work was required to the roof, re-pointing of the walls and decoration of the entrance hall and stairs.
In enquiring of the landlord, it became apparent that no maintenance had been carried out for five years, no maintenance charge had been levied and that there was no maintenance fund in place.
The cost of the work was estimated to be around £50,000 and therefore a consideration of £10,000 for each flat owner. The landlord indicated that the works would be undertaken within the next year, thus our client would have had to find an extra £10,000 shortly after moving in!
Despite our client being keen to buy the property we advised them not to proceed unless there was some concession made by the seller. Terms were negotiated and the seller agreed to pay £10,000 to the buyer on completion to compensate towards the cost of the works. All parties now agreed the sale proceeded.