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Flying Freehold advice 17:02 - Mar 29 with 1679 viewsCamberleyR

Apologies in advance, the background to this is a bit of a ramble but I've tried to keep it as concise as possible.

I'm in the process of a house move down to Somerset and just wanted to guage the LFW faithful's opinion on a flying freehold issue I've got on the new house. The background is that the property was bought at auction by a developer (in January 2020) and extended and renovated. We loved it and put in an offer of five grand over the asking price which was accepted to secure it.

The house is one of ten semi-detached properties in a cul de sac and all houses were originally (about 140 years ago) built the same. The property to the right of each semi (our house) has a front bedroom that has a very small flying freehold (about 50 square feet) over the entrance porch of the neighbouring property. Conversely the house on the left next door has a bedroom at the back that has a flying freehold over part of our kitchen and utility room.

The sale has been taking a bit longer than expected particularly as this property is empty and our buyers don't have anything to sell (buy to let). Because it had been taking a while (we had the offer accepted a week before Christmas) and not much progress was seeming to be made, a couple of weeks ago our vendor was getting a bit fidgety and was threatening to remarket the house (we haven't exchanged contracts yet) unless there was some good progress which there since has been.

Our solicitors have told us that when he bought it, he bought blind, probably didn't read the legal pack (cannot 100% confirm that) and wasn't aware re the flying freehold issue as there wasn't any legal agreement in place with the neighbours. He initially suggested an indemnity insurance policy for the flying freehold issue which some lenders accept and other houses in the road have used. His solicitors and mine said a new deed of covenant would have to be drawn up but this would also need to be agreed with the neighbours as well. He has had to pay £1200 to his solicitors for this extra work and the neighbours have engaged solicitors who are requesting £2000 for their bit.

Sorry for the long ramble but to cut a long story short, we received an email from the vendor's agent today with a request from the vendor for a 50% contribution for the neighbour's legal costs (£1000).
Do we 1) Flat out refuse this request because he hadn't done due diligence when buying or 2) given that we haven't exchanged contracts yet, do we offer a smaller (say 25%) amount as a goodwill gesture to keep him onside and not threaten to remarket the property? I have emailed my solicitor about this in the meantime and am awaiting a response.

Thanks in advance guys.


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Flying Freehold advice on 17:15 - Mar 29 with 1656 viewsRangersDave

Fecking hate it when these things crop up.

I'd walk away mate, not worth the aggro in my books.

had it happen to me, and didnt like the experience st all. I'd be concerned if your buyers arent able to get the funds either.

Best
Dave

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Flying Freehold advice on 17:40 - Mar 29 with 1601 viewskensalriser

Vendor didn't do their homework and now wants you to help pay for their incompetence!

You've already offered £5k more than they were hoping for so really they should eat it. But how much do you want the property? If you really do and can't face going back on the hunt, offer them the 25%. They'll probably take it.

Also, give your purchaser a deadline.
[Post edited 29 Mar 2021 17:41]

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Flying Freehold advice on 18:00 - Mar 29 with 1562 viewsCamberleyR

Flying Freehold advice on 17:15 - Mar 29 by RangersDave

Fecking hate it when these things crop up.

I'd walk away mate, not worth the aggro in my books.

had it happen to me, and didnt like the experience st all. I'd be concerned if your buyers arent able to get the funds either.

Best
Dave


As far as I know our buyer's funds are in place so that isn't a problem. The issue we had at our end is that although my house is a freehold property, the development it's on is privately managed by a management company and a small service charge is paid twice a year to help with the upkeep of the estate. Any purchasers of houses on the development need a management pack from the management company and my solicitor was having issues getting hold of this for our buyer's solicitors.

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Flying Freehold advice on 18:04 - Mar 29 with 1550 viewsCamberleyR

Flying Freehold advice on 17:40 - Mar 29 by kensalriser

Vendor didn't do their homework and now wants you to help pay for their incompetence!

You've already offered £5k more than they were hoping for so really they should eat it. But how much do you want the property? If you really do and can't face going back on the hunt, offer them the 25%. They'll probably take it.

Also, give your purchaser a deadline.
[Post edited 29 Mar 2021 17:41]


We really do want the property, it is perfect and having come this far I really couldn't face going on the property hunt again. I'll see what my solicitor advises but I am toying with the idea of offering the 25% to keep him onside. If we'd already exchanged contracts I would certainly be telling him to stuff it.

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Flying Freehold advice on 20:45 - Mar 29 with 1405 viewsJuzzie

I’d probably go along with the 25% goodwill gesture.
I too went along a very long and painful process last year and there were a couple of ‘piss-take’ moments from other parties. In one case I flatly refused and in the other I went along with it (although I didn’t agree with it) as it was £200 which is a lot more digestible than £2000.

Until you exchange, the whole process is a game of bluff and gamble. Quite ridiculous really.
Even though it was made very, very, very clear right at the beginning to all parties that the end-to-end timeframe was going to be longer than expected (and the reasons why) and we should only proceed if that’s fully understood and accepted, when exactly that happened one of them started moaning and threatening to reduce their offer.
I git narky with my estate agent as it felt they were more on their side more than mine (of course, they didn’t want it to fall through and lose their wonga they fid fk all to earn anyway) so I basically said “ok, if they want to pull out thats fine. Im not reducing the sale because of something they knew about from the beginning and their solicitor was dicking around anyway slowing things down further”.
Never heard back and the sale went through.
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Flying Freehold advice on 23:02 - Mar 29 with 1305 viewsdixiedean

I think you have to strip it back to the basics . Forget whose ‘fault ‘ the situation is. Put aside the principles of the matter and consider if you want the place enough to pay the extra. If it’s your “ forever home “ ( apologies for the dreadful phrase ) then resale value is less important so it’s about where you want to live . In a nutshell, Is the house still worth buying at £ agreed price + £1k ?
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Flying Freehold advice on 10:12 - Mar 30 with 1180 viewsPhildo

Flying freeholds are quite rare but not unheard off. Lenders are mostly ok with them (at present) if it is a smallish area but tend to tighten lending criteria in tough times and you are taking that risk.

The deed of covenant is needed as you need the other owner to promise to support your bit of flying freehold - not knock their property down and leave it dangling in mid air.

Indemnity policies allow lenders to proceed but are a bit of a waste of paper apart from that.

It will inevitably be a pain when you come to sell as you will have to go through explaining all this to a buyer.
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Flying Freehold advice on 10:53 - Mar 30 with 1153 viewsCamberleyR

Thanks for all the advice so far guys. My solicitor replied this morning basically saying I'm not obliged to make a contribution to the neighbour's legal fees but that the seller by speaking to the neighbours about the indemnity insurance policies they have, he has made them invalid by his knowledge of them!

According to the solicitor, and I wasn't aware of this, all indemnity policies state that the existence of them, should not be disclosed to anyone other than the owners of it and legal professionals where necessary.

He may also have shot himself in the foot slightly as they will also have an issue if they decide to pull out and remarket as they cannot obtain standard indemnity insurance as their solicitors have approached the neighbours.

We do really like the house and don't want to start all over again so I'm leaning probably 80-20 in making a small goodwill gesture offer.

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Flying Freehold advice on 11:01 - Mar 31 with 954 viewsfrancisbowles

Flying Freehold advice on 10:53 - Mar 30 by CamberleyR

Thanks for all the advice so far guys. My solicitor replied this morning basically saying I'm not obliged to make a contribution to the neighbour's legal fees but that the seller by speaking to the neighbours about the indemnity insurance policies they have, he has made them invalid by his knowledge of them!

According to the solicitor, and I wasn't aware of this, all indemnity policies state that the existence of them, should not be disclosed to anyone other than the owners of it and legal professionals where necessary.

He may also have shot himself in the foot slightly as they will also have an issue if they decide to pull out and remarket as they cannot obtain standard indemnity insurance as their solicitors have approached the neighbours.

We do really like the house and don't want to start all over again so I'm leaning probably 80-20 in making a small goodwill gesture offer.


This sounds an odd one but there are always hidden costs that crop up. Also, as you know prices are going up in several areas, with the working from home development. If this 'goodwill gesture' ties up all the loose ends and gets you to where you want to be it has to be worth it.

We moved south from Surrey Heath about three and a half years and it's great. We had lots of unexpected costs with the house, things that we hadn't planned on doing but decided we may as well. All worth it to get to where we are now.

Good luck with it.
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