👉🏽 My Free Intentional Spending Tracker - nischa.me/intentionalspendingtracker Thank you for watching :) Please note, the content in this video is specific to England & Wales
Right, in Spain there is not such thing as lease holders, everything is Shared Holder, and the price of the maintenance services are set by the owners of the flats, so you have control over that somehow. OTOH that is why when you buy the property, the square meters are listed including your proportional share of the communal spaces, or in best cases are listed with two measurements, your total space including the communal spaces (metros construidos, builted square meters) and the ones that you have just for yourself (metros habitables, livable square meters). That way it is always cheaper to maintain a flat, even if you have lots of more services like pools, tennis court, concierge, private security, heating etc... And insurance is a must to have 2 policies, one that it is included with you communal bill that covers the communal spaces, and one for your own property, that way home insurance is also way cheaper and with lots of coverages. Not everything done in the anglosphere is the best way to do it. ;-)
More property and investing in property videos would be great, for example comparisons of different opportunities with property such as buy to rent, HMO, etc.
What the Grenfell Tower situation has done to privately owned flats has completely put me off ever considering a leasehold flat. We have two tower blocks in my town which have been wrapped in plastic and scaffolding for years, because the freeholder had all the insulation removed on safety grounds (rightly so) and imposed a phenomenal cost (over £10,000) to each leaseholder to pay for he remedial work which the owner company cannot afford to pay upfront. These unfortunate leaseholders now have flats which are unsaleable, cold and damp, and covered in plastic so they can't even look out of the windows. It's a scandal; my heart goes out to these hard working people.
Service charge is the main difference I think between a house and a flat - if you own a house you can DIY it if you own a flat it can be extremely expensive plus it includes things like lifts that you wont have in a house. to be honest it often feels like I'm still renting despite paying a mortgage to "own" my flat. Downside of a house in London and elsewhere - more likely to be broken into.
This is a unique UK scenario. In Australia all apartments the land is part owned by the owners (scenario 3). There is no such thing as leasehold. This makes buying apartments a solid choice to get into the market. The only major cost is body corporate fees and maintenance levies (~$2k pa)
Its only in England. I think in North Ireland and Scotland it's owned partly owned by person buying the flat. Also there are no council charges and water bills like in London. Downside of owning a house is most are 1930s if not than 1970s built and there are lots of unknown works like changing entire kitchen unit, double glazing windows, flooring, and energy bills. Most houses are old and energy runs £7000 per year. Also it's too cold or too hot. And the prices are expensive that one might end up paying somebody else's retirement. Also the houses are not near to the station or high street and the good ones those are cost twice. As soon as one enters a house one feels they have moved to the 70s because the houses itself are so old..
Not just Australia mate, in all civilized countries the people who buy the flats own part of the land the building sits on. And there's no or little council tax. I've lived in 3 other countries and the UK is the only one where this level of condescending ripoff happens.
Yes please do make more on property. What you already are doing is great and very helpful and you make it easy to understand and therefore easier to make a decision what is right for me. Thank you for the great advice and content! Love it!!
I love the freedom and privacy of a house .. front yard .. backyard with no neighbors .. etc I also have condos that I rent out and the association fees per month doubled over the last few years. Another excellent video
Some other things to consider: there is no such thing as leasehold in Scotland. If you own a flat, you own it. There are still maintenance costs involved, but houses need maintenance too, including the whole building. If the roof leaks on a flat,you pay a portion. If a roof leaks on a house, you're responsible for the whole thing. Flats will have lower capital gain, yes, but higher return in rent. And finally, while you can theoretically add value to a house, it still requires planning permission, architects, engineers and builders, and most extensions do not recoup their cost in added value.
When you 'buy' a flat, the service charge and the maintenance costs - so the example of the lift which you mentioned, the charges would also increase in time as well so if the bill was £300 for every leaseholder, then in a few years time, it will be £500
Service charge in London is getting insane. It’s not uncommon to find new builds in canary wharf charging 400-500 pounds per month. That sounds like a second mortgage.
Yes, property videos will be very helpful, also letting your property as an additional income stream will be an insightful topic. What to consider while buying a property to let in the future?
What you're teaching should honestly be taught in schools as a regular lesson from a young age but i've got a sense the government and companies wouldn't like most people knowing what you're teaching (not to sound like conspiracy head Lol) but I'm glad i found your channel and honestly, thanks for the videos, educating us and sharing your knowledge
Please make more videos about renting!! I'm highly considering renting instead of buying because of how much housing prices have skyrocketed in the last decade :(
Wow! This was absolutely fascinating. I automatically thought a flat would be better because it's cheaper, but I had no idea how much impact being a leasehold has on a property. Not that I can afford a flat or a house at the moment😅, but this is all good info for the future. Thank you! And yes, please to more content on this topic!
Thank you for sharing with us the factors that i would not have even thought of when deciding between buying a flat or a house. After this, my vote definitely goes to buying a house. Keep up the great work and videos! 😊
In Spain, if you own a flat, generaly you own a % of the Lot. It's not always the case but generaly that's it. You can't sell the flat without the % of the lot but, if the Building ever goes down you will be the owner of that lot in the determined %. (Many rules apply.) And also your propiety is not temporary. You own the flat with no time limit and your family can inherit the flat with no time limit. There are mandatory costs of maitenance and reparations but it seems like a good deal to me. (Almost 67% of spaniards live in flats)
could you do a video about WHEN to buy? What signs to look for when entering a deal (location, market crash, price...), where you could go for good deals, what to avoid etc.?
Also worth mentioning that if you move into a flat as it’s cheaper, then move into a house, you’d have to pay stamp duty twice. Probably more applicable in the south where prices are higher.
I was having this exact same debate on another video earlier today. Personally, as a primary residence I would always choose a house _unless_ it was a _seriously swish_ flat - I'm talking concierged at Canary Wharf with a tremendous balcony and jawdropping views, for example. I actually knew someone who lived in a flat like that. His rich uncle owned it, and he was allowed to live there so long as he paid the mortgage in lieu of rent. He was paying something like £900pcm (rich uncle got a very favourable mortgage, plus this was in 2011 or so) when the rental value would have been more like £2300pcm. In a more realistic scenario, say I was in Glasgow, Derby or Cardiff with £180k in my pocket and there was a house and flat for sale at the same price, the gap narrows. I'd probably have the house and just progessively renovate it, if it's looking tired at the £180k price point. That's because I've been renting flats for a while and have frankly become fed up of it for varying reasons and there are too many drawbacks and nuisances for me to drop that kind of money on a property which has service charges, no storage, no serious renovation options, people coming and going all the time etc. Buy a house and you get some kind of private outdoor space where you can erect a shed to store your junk in, you probably get an attic (or can extend into it), there are _probably_ no service charges if it's on a regular street, you can extend or build a conservatory or whatever. There are also no petty rules governing your laundry, your BBQ, or your smoking (if you do that) etc.
I would never buy a leasehold after what happened to a friend. The freeholder decided to build another floor on top of the block of flats and this couldn't be objected to, work started, the roof was removed and due to a number of issues the flats below became flooded and unliveable due to lack of diligence during the build work. The freehold is in a limited company, the director of that company refuses to pay reasonable compensation (only £20k of £100k of damage) and has suggested they will liquidate the company if necessary. Environmental health, the council, the planning departments, tenancy bodies all cannot help so it is now going through the courts leaving 4 leaseholders homeless for over a year now. If you rent a flat, you have legal protections against the landlord. If you own the flat via leasehold you are at the mercy of the freeholder.. not somewhere you want to be!
100% agree. No one should ever ever buy a leasehold property, in my opinion. Awful system. Freeholders and managing agents get away with murder and the law is always on their side. The normal person has no chance. They can effectively do what they like and charge what they like and if you try to stand up for yourself and fight them, it will be long, convoluted, cost you money, almost certainly cost your mental health to some extent.
So what happens if you own a flat leasehold, and then one day in the future the government/council decide that they want to tear it down to make room for something else? Do they have to buy it off you first, or do you just loose your property with no compensation since you were not the freeholder? Also, I would love to see more property related videos on this channel. Especially since the property game seems to be constantly changing so rapidly nowadays. It would be nice to get your opponion on this to keep up to date with it all.
I managed to find a house just outside of London for the same price as many flats (and maisonettes). You get your own allocated parking and visitor parking (which is rare in new build flats nowadays), dual aspect (again often rare with new build flats), a garden, and as Nischa said freehold, with no additional charges like ground rent and service charges. Of course, the compromise is location.
Hey, where did you find your house just outside of London please? Would be great to share the location as I want to downsize my house and move just outside of London as it's too expensive to remain within London. Thank you.
@@DaisySK43 Hello, Hertfordshire. You will have to research what town/village suits you best, but it's more family-friendly, greener, easy and quick train links into London, access to motorways etc.
@j.smith.8915 hello 👋🏻 thanks exactly what I'm looking for I'm done in the city of Croydon from birth! I need a change with greenery and good links to London. Which area in Hertfordshire is it if you don't mind me asking please? Thank you 😊
I’m considering shared ownership because the house prices are wayyy too high! Please can you do pros and cons of owning / shared ownership and what costs to look out for etc. where to find a property etc
Freehold is better in my opinion. Having a house myself with a mortgage you are right I am free to renovate and repair if and when I see fit. More control over costs with not too many price hikes apart from mortgage interest rates from time to time. Thanks for another great informative video Nischa.
I remember when you had like 20-30k subs. So amazing to see i knew you were gonna blow up love the content keep it up. Who cannot like content from someone like youu
Please make a video on freehold houses and their disadvantage for the old people. It's not safe for an old couple to live alone. I know so many senior couples are selling their houses and moving to flats where they don't need to care for the maintenance, etc. Some people are finding a solution to this problem by renting the top floor to young people providing them with some emergency help and daily interaction opportunity. My parents sold their house as my father's health deteriorated and they moved in a flat of my younger brother. Of course, they are not happy but there is no other choice. In contrast, my in-laws are renting out the parts of their house, and the tenants provide immediate help in case of some urgent need. So beyond money, there are other issues as well. I have to take this decision 10 years from now. So I keenly watched your video. I don't like living in flats for the reasons you listed and I fully agree with it. It's a great video that you have made. I don't see many people discussing it.
Great video, clear points, well made. This is something that I am starting to consider again now i'm looking at getting back into property ownership, so it's good to remind myself of the pros and cons!
Super helpful! I just dodged a major bullet on a leasehold, the freeholder dropped a 100k maintenance bill on all the owners and has really upset everyone. I'll not waste my money on a leasehold now, just bite the bullet and go for a house.
Another great video with very important points pointed out ☺️ It would be very interesting to learn more about real estate through your videos, so please keep sharing your knowledge about this topic. I'd be interested if you ever thought about the opportunity to buy property abroad? In general: Thank you so much for your very valuable work Nischa - absolutely love your content ❤
Thanks for the video, different from here in Paris where you own a share of the land if you buy a flat. Public service taxes equals roughly 1k euros/year for a 1 bedroom apartment and it will cost you around 1,5k euros per year for the "frais de co-propriété" ( for co-ownership expenses like fixing the elevator, "concierge" etc ...) ... and you always own you property (not 125 years or ...)
Very informative video. Well done. Perhaps you can address another practical example. That is how to invest £100k or £200k as they are not enough to buy a house or flat in an area that would increase its value over time. How can such amounts be invested in other ways? Also, is it true that a typical average return on investment in shares and stocks are 5%?
I find leaseholds with a half decent property manager are a paradise compared to a lot of freeholds. Local authorities / councils don’t give a toss about neighbour disputes, noise, dogs barking at 2am, etc. and there is very little you can do to compel them to do anything about such things. Whereas for a leasehold, your building manager has a responsibility under your contract to deal with these issues, and would be in breach of contract if they don’t… which you can in theory sue them for, which I suppose they might try to recover via the service charge, but if they start to take the piss then you can sell your flat before that happens and leave your neighbours with the bill for being a nuisance to begin with.
Love your videos. Would be great if you could also include callouts on what's applicable to US vs UK, and what the equivalent US terminologies are so everyone can follow along. If the video is only meant for a particular audience that's fine too, but would love a heads up at the start. :)
Thanks @nishcha for sharing the interesting topic. I think this analysis have dependencies whether it is landed house or flat. It is much appropriate to England & Wales. For other countries, in terms of investment to property ladder, the complexity of governmental approval, consumer behaviour, the security, the ROI bet LH and Flat..etc., need to be factored in. plus the T&C of mortgage on flat & landed house is crucial.
Valuable info dear Nischa. I don't normally comment but I hope this may also add on some info.I have to say that Location is the key whether house or flat for long term growth. House do cost alot to fix too at a lump sum cost although U can choose when to fix the problem but as house gets older, the value depreciates too unless you renovate which cost heaps too whereas with Flats/Apartments/Condo... You pay a body corporate or Strata fees every month or quarter to keep the place in good order but it is not in a big lump sum of money. In hindsight, the maintenance fees for both House or Flats comes to the same over time. If you own a freehold flat, the body corporate fix the building problem unlike owning a house, you would have to do the hard work, running around looking & waiting for tradies to come to fix your House so most retirees sell of their home to downsize moving into Flats for that reason, lock up and peace of mind not having to fix anything but just paying the quarterly maintenance fee. I hope this helps people to decide more of which to buy depends on their circumstances and lifestyle.😊
I bought a flat for investment 16 years ago at the top of a property bubble here in Ireland. It still hasn't recovered it's value, I'm paying 2200 per annum service charge and in I pay 50% tax on all rental income. Wish I'd bought a house instead it'd be worth way now more than I paid then.
Free hold house with a drive and garden is the best. Flat is a nightmare: lease, service charge, ground rent. Value of the flat doesn’t go up like the house. My house went up 40k in value in 2 years. My flat went down 20k and then went up 15k so down 5k in the last 5 years.
Thank you for your insight. One thing I'd add regarding AirBnB and freeheld houses: as an architect in the USA, I've found that many jurisdictions are rather restrictive about allowing house owners to use their houses for short term rentals. When I built my house, there was an added fee for, and no guarantee of obtaining, permission to use part or all of my house for short term rentals. So that's a potential damper. This likely does not apply everywhere, but it is good to check with the local community development department what their rules are.
From experience, try and avoid buying a flat to live in. Service charges go up yearly, any general repairs to the flat by the freeholder, you will have to contribute. Buy a house if you can even if it's in a cheap area. It is a better investment
It would be really helpful if you could address the changes in the Buy to Let market and how best to approach the decision on whether to proceed with a B2L property.
It's not that black and white - In terms of capital gain, a flat in a good area increases in value a lot quicker than a house in some out of town areas where the floor space might be more affordable. Imagine buying a flat in battersea or vauxhall in 2000s vs buying a house in thornton heath, you'd have tripled your money on your flat vs double on the house In terms of rental, a flat in a central area will always return more and have higher occupancy than a big house in an out of town area In terms of cost of living, a new energy efficient flat will be a lot cheaper to run than a large, old house In terms of quality of life, the centrally located flat will offer less space but might be nearer to parks and amenities, where as the local high street of your out of town house might not have much going on The service charges are a big downside of leaseholding a flat, but if you go for a low-rise without a lift it will be a lot more manageable
Just sold my flat which I lived in and then let out! What a headache! As a landlord! Paid over 40% tax as a higher earner! Then to have the headache of trying to sell it. As you need permission from land owner, management company etc..
This is helpful. I’m saving every spare penny this year, and my original intention was to then put that money into a fixed savings account. But I’m now considering investing that as a deposit on a property.
If you can, please upload more videos about property. I may still have something to learn, god knows…😀another few things to consider: 1-Yes, flats are the cheapest way to move on the property ladder, however the value of a flat doesn’t increase as much as a house. A house pretty much doubles up in value every 10 years, but for a flat, the increase is nowhere near. 2- some people think that moving to a house from a flat will be better because you will save on maintenance charges bill from a flat. However, take in consideration that depending on the the tax band of the new house you moving into you will already ruin those savings either partly or entirely. 3- finding the cheapest contractor, I disagree. You buy cheap, you buy twice. Don’t ask how I know.
Good Video! here in Australia houses tend to hold there value better being more desirable. Whilst most of the time its cheaper upfront to buy an apartment the upkeep is actually a lot more then a house. also resale a house will be easier to resell if you really need to move it on. The other negative with apartments is you cant control the costs as you mentioned, we also have strata fees in Australia on top of rates for apartments and that can really stack up on top of sinking funds and repairs as stated. You generally don't have a choice either when it comes to the external structure on if it gets repaired or not and costs are divided up between the owners and organised by the strata companies. Not to mention the strata company will tack on the administration fees on top of the repair fees.
Do you mean to tell me that, in the UK, you never end up owning your apartment? That's awful! Definitely not the situation in some other European countries.
If you pay it off, you can own the flat, but if the flat is a leasehold, then you don't own the ground beneath you. So people usually extend their lease when it runs low (approaches 80 years remaining).
Good timing with this video as I’ve been wondering the pros/cons with House vs Flat as I’m hoping to buy a 2nd property soon! I think location has a key factor in flat vs house too from an investment point!
Your ground rent changes to zero when you extend your lease, via a statutory lease extension. New builds also do not have service charge. Service charge on a leasehold exists to ensure maintenance and repairs. If you own a freehold you have to still bear these costs but they're just managed by you. It's not necessarily cheaper. If a roof on your freehold house needs replacing that's your cost. If you need to fix your driveway that's still your cost and you need to pay 100% of the cost, and organise it by yourself at your own time. You need to have lived in a flat 2 years to extend the lease. You can have this deferred to you on purchase by the vendor if they have lived there for two years.
Great video Nischa! My friends keep asking me to make a video about the UK property market too so this is a really good one to show them for the meantime!
Hello Nischa Ji....I must say I am your biggest fan ever....i just love your videos but more so your narrations and the way you speak......it's so interesting.....I feel I can go on listening to you forever.....thanks for sharing such insightful information.....m sure these are prevalent and relevant in all kinds of economy and in every country....👍👍👍👍👍
I think it just depends… I have a house and the rent is okayish because of the location, in Manchester City centre the apartments are brand new and around the same price but rental income would be way higher because of location and condition
Love your videos, it’s become a habit to watch every Sunday :) Question, what equipments do you use to record your videos? The quality of it is amazing!
Success depends on the actions or steps you take to achieve it. Building wealth involves developing good habits like regularly putting money away in intervals for solid investments. Financial management is a crucial topic that most tend to shy away from, and ends up haunting them in the near future.., I pray that anyone who reads this will be successful in life!!
There is a little caveat to a freehold as you are actually never a full owner in the UK. Under UK legal system, the Monarch, as head of state, owns the superior interest in all land in England, Wales and Northern Ireland. In most cases, this is usually irrelevant but it can become relevant if a freehold property becomes ownerless. If this happens, freehold land may, in some circumstances, fall to the monarch as the owner of the superior interest. This process is called 'escheat'. Some other countries even in EU have laws where they also can confiscate owners land in certain circumstances.
Thanks for the content.. highly helpful as always. Yea, would be great to see more real estate / property videos, will be investing in property so its all valuable content. Thanks for that south facing garden tip too. 😊☀️💯
Thanks for your videos and content! I find it all very informative and friendly; thanks a lot! You mentioned the concept of the "property ladder". Everyone talks about it, but it will be great to understand a bit more about what it means, how to make it work well for someone and how to deal with banks and other entities that will give you the money for it!. Thanks
Your videos are great 🙌🏼 Would love to see you cover finances for the self-employed/freelancers, particularly relating to taxes if you have any advice there?
Thank you Nischa, as always very useful! Real estate subject is super interesting for me but I only have basic understanding of it for now. I would be grateful to see more of those videos!
You can summarise the two property types as follows: With a freehold house, you own the building and ground it sits on. These two, generally, become more valuable over time. With a leasehold flat, all you ever own is the right to live there. And that right steadily becomes less valuable over time - unless you pay to stop that erosion.
I’m actually wondering whether to buy a property at all. The UK market is a crazy place atm. Given the increasing costs of utilities, taxes etc. they seem like a money pit to me. That, combined with effects of climate change ( ground source heating, insulation, de-commissioning of power stations ) would not encourage anyone to get on the so called property ladder. Perhaps if The Government insisted home loan providers changed the payment period from monthly to fortnightly buying a place might just become a little more affordable for some. If I were to buy anything it would be a terrace in a nice area that needed some tlc. Near the sea would be even better but not too close!
