Buying a block of flats is often more complicated than buying a single house or another type of residential or commercial property. There are a few things you need to know before making this investment, and this is what we are going to discuss below.
The Difference Between Leasehold and Freehold Properties
A freehold arrangement is where you own both the building and the land it sits on. A leasehold property is one where you buy the right to occupy land or a part of a building without owning any of them outright. Flats are often leasehold as they are shared between many people while blocks of flats can be either depending on specific circumstances. Navigating leasehold arrangements is often more complicated legally than navigating freehold ones.
Major Repairs May Be Needed
Repairs and maintenance are essential if you want to give your tenant a great service and living space. In many cases, landlords and sellers will do some repairs before selling to make the process go smoother and to increase the value of the property. It is still important that you go through the block with an inspector to find any issues that you need to deal with. If extensive repairs are needed, you need to talk to the seller to find out who will be responsible for the cost.
You Will Need Insurance
Buying a block of flats is a serious investment that should be protected and the best way to do this is by getting the right insurance. Insurance companies provide insurance for residential and commercial properties, but what you need in this instance is commercial insurance.
As with other types of insurance, this type of landlord’s insurance combines different types of policies depending on what you need so that you are protected from several events. For example, you can be covered for all or combination of fire, storm, flood, water, and vehicle collision damage. Vandalism and theft are also covered depending on the insurance you get.
The one challenge you might have is finding insurance tailored to your type of insurance which can turn out to be laborious and time-consuming. Fortunately, getting block of flats insurance does not have to be so complicated as there are services that can help you find the right policy. They do this by making it easy to compare block of flats insurance from numerous insurance companies so you not only find a policy tailored to your specific property, but also a cost-effective one.
Hidden Issues with the Area
There are many reasons why someone might want to sell a block of flats, and unfortunately one of these is a current or upcoming issue with the area. It is important to do enough research to find out if any changes are coming and how they will affect your investment.
When buying a block of flats, it is important to take your time to consider the various factors that determine if it will be a good investment. You also need to think about the costs of ownership such as maintenance and insurance and how they will affect the investment.