There are three Stages that will improve our costs/control/ownership. The diagram below shows the mix of options that are possible and the gains that each offers. These Stages are -
- Exercise our Right to Manage - RTM.
- Purchase an Extension to our lease.
- Buy our freehold and move to a commonhold.
Reforms have been passed to Parliament. These would improve the options for us.
The timing of the reforms varies -
- RTM is ready for us to implement now. We take control our costs - and use the reforms where relevant.
- Purchasing a lease extension under the new scheme is with Parliament now - but who knows when the changes might arrive? -
- Reform of buying the freehold and moving to a commonhold is still under discussion - lobby our MP to ensure that the promised reform is delivered.
Of course, there are costs to pay for each Stage - for us and to the landlord.
Costs for each Stage are -
- RTM - shared amongst all apartments, each would pay between £120 and £240. This is known.
- Extend your Lease - at present this is ~£4k + legal costs ~£1500 per apartment. This may reduce with the changes in the Law - but when?
- Buying our freehold is expensive today - £10,000 to £20,000 per apartment. The Law Commission's proposals to Commonhold may reduce this.
On a simple cost basis alone: 1 - go now : 2 - personal action (see below) : 3 - contact our MP and wait.
click image to enlarge
Today - We do not want to be here (see why) - click to enlarge
Stage 1 - Timescale now - click to enlarge
Stage 2 - Wait till new law comes in - click to enlarge
Stage 3 - Wait for Commonhold reform - click to enlarge
We think that we should set up an RTM company now.
The attraction is that for modest cost we can gain control of all expenditure associated with Aston Court (except ground rent and Diglis Water charges)
and will have the freedom to choose our agents, service suppliers, facilities as we see fit.
The current law that applies to RTM suits our needs today. We would test the reforms that the Law Commission has placed before Parliament and adopt where relevant.
To realise this we must act collectively. The decision to set up an RTM company must be made by a majority of the owners.
The form and activities of an RTM company are fully defined in Law so the setup process is simple - an option is to have this done for us by a professional.
Once in place we will reap benefits almost immediately. What we do, and how we do it will be our own choice.
An excellent guide on RTMs can be found here.
Please explore the pros and cons.
We believe that this is the most sensible way forward for us in the short term.
The Reforms that have been proposed to Parliament could make this an attractive option for leasehold owners. The proposals indicate that lease extension could be quicker and cheaper than now, and the extension would move from 90 to 990 years. However no-one knows when this might happen.
Current thinking by experts suggests that it is probably better to take action under the existing laws, rather than wait for reform.
- Each individual owner can exercise this alone. There is no need for collective agreement. Action and gains are in your own hands.
- The Govt. will provide an online tool to calculate how much your lease extension will be - see here for an illustration.
- The extension grant is 90 years at present which places the risk of losing your home well into the future - sleep easy!
- The grant of an extension will remove Ground Rent - this will save you and your successors £246,000!
There will be legal costs associated with this option - obviously if you act alone, your legal fess will be yours alone. Acting with others could reduce the costs. A community dialogue here could help here.
The upside of buying a lease extension is that the saleable value of your apartment will increase by between 5% and 10%.
So if you are thinking of selling in the near future, buying an extension now makes sense.
Buying our freehold and moving to a Commonhold is the only way to own our homes.
However, this is the least urgent part of our planning. Reforms that the Law Commission has suggested will be explored by Parliament so the new
legislation is not yet known. However the move to commonhold gives great hope for us.
We think that we should wait until the deliberations here are finalised - we can then assess what action we might take,
However given the vagaries of politicians' commitment on promises, it makes sense that we share our hopes
with our MP, Robin Walker, to enlist his support for reform.
We should also lobby Lynn Denham who is a Councillor for Cathedral Ward and the prospective Labour Party candidate.
She has visited Aston Court and is aware of our issues. She has written supportively re reform of leasehold and of issues in Diglis.
So please write to them and express your hopes.
Contact Robin.
Contact Lynn.
If you know of anyone else you think could help, please contact them, and also let us know. The more of us that contact influencers the better.