Can a freehold estate have a management company?

Typically, in the cases of flats and apartments, there will be management companies who will be involved with managing the services for the apartment block. Each leaseholder (flat owner) will need to pay for the services provided by the management company in the name of service charges.

However, there is a common misconception that these management companies apply for leasehold properties only; there can also be management companies for freehold properties.

There are two ways in which management companies can be created; one, the developer will create the company and then will appoint managing agents to provide the services. However, in cases of smaller developments with a few houses, the individual owners may take a share in the company and collectively run it.

The details of the management company can be found within the title deeds to your property and they will be responsible for maintaining common areas such as footpaths, open spaces, car parking areas, etc. Each property owner will be required to make contributions for these services in the form of service charges.

Will this impact the sale of my house?

Properties with management companies is becoming increasingly common and therefore it should not affect the sale of your property. Although, this does mean that additional paperwork will be involved.  If the property that you currently own has a freehold management company involved, you will need to obtain a Freehold Management Pack (also known as FME1) which will include vital information such as the total service charges (including the likely increases), the details of who organises maintenance arrangements for the shared areas/amenities, payment history, budgets, any fees that your buyer may be expected to pay post-completion, etc.  This pack will then need to be provided to your buyer solicitors for review.

No two management companies are the same and therefore the costs for these packs can vary and the timescales to issue them from the receipt of payment can also vary greatly. Therefore, for the smooth running of your transaction, it is important that this management pack is requested at the outset of the transaction to avoid any delays.

For further advice and assistance please contact our Residential Property Team on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk