Hi

Thanks for requesting me.

The main difference between the two is that a flat is a leasehold interest because you buy a lease of the flat for a set period of time. A lease is typically granted for either 125 years or 999 years.

The thing to look out for is if you buy a flat with a lease you want to make sure that you will dispose of it before you get to around only 70 years remaining on the lease term. This is because lenders will not generally give mortgages to people proposing to purchase a flat with a lease with less than 70 years to run. You would therefore have to compel the owner of the freehold of the flat to extend it. This would cost further fees and they can either refuse (in which case you would have to litigate to get them to extend) or be slow.

A further issue with flats is that there is usually ground rent payable (ie. nominal rent for the years (eg. £200 per year) and also a service charge, which is a charge levied by the owner of the freehold of the block for costs he has paid out to maintain the common parts of the area. This can be quite expensive and also vary wildly depending on the nature/quality of the block. You can also have problems with them in terms of whether they are competant.

The advantage of a flat is that it can be cheaper to buy intiailly and also located in city centres where to buy a house is expensive.

A house purchase is much simply in that once you buy it you do not usually have to pay any further charges and are responsible yourself to maintain it, so the element of control is a big advantage.

I note you still have not clicked accept to my answer on savings interest/income tax treatment.

If you wish for me to provide you with further guidance on any question you may have in the future then please submit a further question to the board requesting me either by my profile or by marking your question. “FAO Tom”.

Kind regards,


Tom

Bi

You will see I have answered above.

Is there any more information you require?

Kind regards.

Tom