If you’re considering turning a series of flats into one property, be aware of the financial and legal implications before you start, says Jennifer Newton.
Converting several flats into one property can be a great way to achieve your dream home, but there are pitfalls. For example, if one flat owner withdrew from the sale after you had already bought one of the other apartments, you would be stuck with a flat you don’t want. You need a way of controlling the timing of buying all the flats so you won’t end up bound by contract to buy each one separately. This also means you can arrange for the property to be surveyed by your mortgage lender in order to take out one mortgage for the whole property and not as individual mortgages for each flat.
Draw up a legal document
Caroline Gardner (right), a solicitor at 1stpropertylawyers.co.uk says:
‘By organising what’s known as an option agreement to buy each flat, subject to certain conditions (together with the grant of planning permission for the conversion) you would have the flexibility not to trigger the option if one flat owner didn’t want to sell. A premium would have to be paid to each flat owner at an amount negotiated between both parties for the grant of the option, which would give the sellers peace of mind. However, you would only be bound to complete the purchases if the conditions of all of the options were satisfied.
‘Before you incur any costs, you must approach the local authority for advice on converting the building into one residential house. You should also speak to the landlord about buying the freehold, so you could potentially buy the leasehold titles for the flats and merge them with the freehold title on completion to achieve a freehold house.’
Three essential tips for success
1 Planning permission will be needed to convert the flats into one property – check with the local authority first. They are likely to be in favour, providing the plans are sympathetic to the house.
2 The work required to turn several flats into one property will vary. You will usually have to turn a door back into a window, remove partition walls and internal doors and upstairs kitchens.
3 You must merge the different utility meters back into one of each for the property. The gas, electricity and water meters must be turned into single inlets, for example.