Leasehold: five things to check before you buy

Leasehold isn't bad. It's just different. And there are five things that matter more than anything else.

1. Lease length. Anything under 80 years is a red flag. Below 80 years, extending gets expensive because of "marriage value" (a formula that punishes short-lease extensions). Under 70 years, most mortgage lenders refuse to lend. Ask for the lease length before you offer.

2. Ground rent. Modern leases often have zero ground rent (since the Leasehold Reform (Ground Rent) Act 2022 banned it for new leases). Older leases can have ground rent that doubles every 10 to 25 years. A doubling ground rent on a £150k flat can become unmortgageable within a decade. Check the rent review clause.

3. Service charge. What do you pay annually, and what does it cover? Ask for three years of service charge accounts. Look for reserve fund contributions, or lack of them (which signals big bills coming).

4. Management and Right to Manage. Who manages the building? Is it the freeholder, a managing agent, or a residents' Right to Manage company? Bad management = slow consents, botched repairs, and nightmare neighbour disputes.

5. Planned major works. Have there been any Section 20 notices for major works (roof, lift, window replacement)? These can land on you even if the work was scoped before you bought. Ask for the last three years of Section 20 notices.

The LPE1. Most of these answers come from the Leasehold Property Enquiry (LPE1), a standardised form the management company fills in. It typically takes 2 to 4 weeks to come back and costs £200 to £400. Get it ordered as early as possible.