Selling Leasehold flat without Buildings Insurance

  • Filter
  • Time
  • Show
Clear All
new posts

    Selling Leasehold flat without Buildings Insurance

    Hello All,

    A quick Buildings Insurance question to kick off the weekend!

    My Freeholder has recently been served a criminal conviction which has apparently invalidated the Buildings Insurance for our building in which I own the leasehold of one of three flats. I am in the process of trying to sell my flat and have just accepted an offer. Speaking to my solicitor I understand that a mortgage lender will absolutely and understandably not lend on a property without Buildings Cover.

    Now my problem is that the Freeholder has absolutely no intention of taking out Buildings Cover in the foreseeable future. Despite threat of court action, etc, its so far down his list of priorities that I have to find a workaround to insure the flat/building is covered and that the sale can proceed.

    - I have had conflicting advice from solicitors and the LAS regarding if it is possible and legal for me (or anyone other than the Freeholder) to take out Buildings Insurance in my own name. Does anyone have any insight into this?

    - If I was able to take out Buildings Insurance in my own name what happens after the sale? Is this transferred to the buyer or invalidated?

    - Has anyone got other suggestions or tips?

    It's frustrating that the Freeholder dragging his feet could potentially ruin my sale. Any help would be greatly appreciated!


    You can probably obtain valid insurance for the entire building - but explain to the insurer exactly who you are.

    Unfortunately the very point of all the vacuous and non-enforceable legislation in the leasehold arena is precisely to shield freeholders against any sort of prosecution for breaking the law. You could if you like ask your local authority to prosecute the freeholder. They will politely decline.

    But the freeholder won't be answering any questions asked by the seller - and there is absolutely no sanction if they do not - so they can bully with impunity. So you will not sell anyway.

    Bottom line -- never buy a leasehold property imho except at a massive discount (that takes proper account of the risks and legislative problems -- which the recent parliamentary discussions fail to address in any shape or form).


      This is a flat, so leasehold is normally the only option.

      The legislation is unenforced, rather than unenforceable. The problem is that local democracy is largely a fiction as far as spending money is concerned. Central government manipulates things to keep taxes down, with the result that councils don't spend on anything for which they have discretion, such as prosecuting leasehold offences.

      The best solution, here, may be a a cash sale, at a discount.

      The criminal conviction of the freeholder probably means they cannot have an interest in the policy, but they need one, so medium term, RTM on buying out the freehold may be the only realistic options.


        You plus the other 2 leaseholders together as "joint policyholders" may be able to insure your building ( without the freeholder ).

        You should ask the insurance broker to quote for block of flats insurance policy with a clause added to say "the interests of the leaseholders and their mortgage lenders are automatically noted" which allows the leaseholders and mortgage lenders to make a claim under the policy.

        This will allow the insurance policy to continue after you sell and moved away.


          Thank you all!


          Latest Activity


          • Rent Guarantee Insurance
            by oi2004as

            I would be interested in your view on the following

            I received a renewal Legal & Rent Guarantee Insurance documents from Rentguard (which initiallyy I purchased through Openrent)

            There is the following condition in their 'statement of fact':
            11-07-2020, 11:59 AM
          • Reply to Rent Guarantee Insurance
            by tatemono
            that's the rent guarantee insurance we use and which has worked for us for many years....
            13-07-2020, 20:58 PM
          • Reply to Rent Guarantee Insurance
            by AndrewDod
            No 7.1 will not likely stand up in court. You cannot have open ended guarantor deeds that apply in this way robustly.

            The fact that you have said that it will apply also to unknown rental increases, for an unknown term, and covers unknown costs means that it is likely invalid
            13-07-2020, 19:39 PM
          • Reply to Rent Guarantee Insurance
            by oi2004as
            To jpkeates
            This is not about zero-risk option. The part which I do not like the most is that I become tenant-dependant for buying insurance.
            They may not reply to my email about their circumstances
            They may not provide correct information
            They may not allow to run re-referencing...
            13-07-2020, 19:14 PM
          • Reply to Rent Guarantee Insurance
            by theartfullodger
            HOW was the guarantee documented please? Enacted as a deed? Guarantor credit checked, given AST & guarantee and advised to take legal advice prior to signing, please?...
            13-07-2020, 19:06 PM
          • Reply to Rent Guarantee Insurance
            by oi2004as
            To AndrewDod
            I have a guarantor on this Tenancy Agreement.
            This is 12-month fixed and then becoming rolling (monthly) contactual agreement.
            The guarantor is a party to the agreement (signed)
            The agreement has the following clauses:
            7.1 In consideration of the Landlord agreeing...
            13-07-2020, 19:00 PM
          • Reply to Rent Guarantee Insurance
            by jpkeates
            I think you're looking for a zero-risk option, but property letting is an investment business with risk baked in.
            I don't blame you! But I think you're going to struggle.

            Like all of us, the rent guarantee insurance sellers didn't see the pandemic coming, and it wasn't covered in...
            13-07-2020, 16:25 PM
          • Reply to Rent Guarantee Insurance
            by AndrewDod
            If a guarantor agreement is valid at all (which is a BIG if) it is not going to be valid past the initial fixed term (no matter what it says) - so as much use as non-stick Sellotape or Jeremy Corbyn....
            13-07-2020, 16:08 PM
          • Reply to Rent Guarantee Insurance
            by Boab
            I doubt anyone in this town has ten years rent. I’m obviously being Uber selective on tenants , but I also wondered about guarantors as well. Does a guarantor have the absolute obligation to cover rent defaults or can they avoid paying as well?...
            13-07-2020, 15:47 PM
          • Buildings & Contents Insurance - Recommendations
            by landlord-man
            Can anyone recommend a broker / insurance provider? I have a 1st floor property with 4 flats.

            I'm looking for recommendations on who provided a fair quote but also any recommendations on companies who actually paid out a claim promptly / fairly.

            Thank You...
            13-07-2020, 10:57 AM