“Leasehold bills make it impossible to budget.”

I bought my leasehold flat two years ago by myself, aged 32. Before that I was house sharing for 10 years with friends. And to be honest I loved it!

I just about scraped together my deposit and have been in my credit card ever since. I rushed into buying, didn’t think long-term, and didn’t save any extra.

I get a leasehold bill every six months (ground rent and service charge for the building). It should be around £400. Last summer it was £1,800, then £700 this month. 

I ask for a breakdown, get a vague response. As a leasehold ‘tenant’, you have no power. The property managers often surprise you with random amounts, so it’s impossible to budget. 

It’s like I’m floating somewhere between tenancy land and mortgage island. And sometimes it feels like drowning. Not to mention all the bits needed to fill a property.

As far as I understood, the flat didn’t need much work when I bought it. But I’ve realised it’s never as simple as that! The costs are never-ending. 

I hate decorating and DIY. There are hundreds of things I’d rather spend my time and money on. I thought I’d love it but I resent it. 

But then I think maybe I’m just Peter Panning my way through adulthood. And this is just the reality of being a grown up!

What is a leasehold? 

In the UK, there are two main types of properties: freeholds or leaseholds. So, what's the difference? If you buy a freehold, you will own both the property and the land it sits on. If you buy a leasehold, you will own the property (subject to the terms of the leasehold), but the land it occupies will still be owned by someone else, known as the freeholder. 

While people who own freeholds manage repairs and maintenance of the building and land themselves, leaseholders usually have to pay regular fees for ground rent and general upkeep. Ground rent is the term for the regular payments made from a leaseholder to their freeholder as part of the lease agreement – the freeholder owns the land, the leaseholder ‘rents’ it over a certain period of time.

Other compulsory fees, usually described as service charges, might cover building insurance, electricity bills for shared areas, maintaining a shared garden, paying a building manager to organise repairs and cleaning of communal areas.

Leaseholders may also be faced with a fee to extend their lease. According to Money Helper, it's a good idea for you to have at least 80 years left on your lease, otherwise the owner or a future buyer may struggle to get a mortgage on that property. Leases are passed from the old owner to the new owner if and when a property is sold.