Often a First time Buyers first property will be an apartment and understanding the different types of ownership and how the buying process works will help.
Flying Freehold, Share Transfer and, less commonly, Leasehold. So, for first time buyers, what are the differences in these types of Jersey property?
The Jersey flying freehold law allows you to buy the freehold of the apartment by way of a “lot” or share in a property that is the subject of a Declaration of Co-Ownership. The Declaration sets out the rights and obligations of the owners of the shares who, together, form an Association of Co-Owners. The share grants the buyer the ownership of a particular apartment, parking space/s or store, together with a percentage interest in the common parts of the property. A proportion of the expenses incurred in administering and maintaining the common parts, such as the structural and shared areas, is payable by each owner of a share. The Association of Co-Owners decides upon maintenance and other issues by majority vote and contributions to the common expenses are collected by the Association Representative or Managing Agent as a service charge.
Share transfer purchase means that you are buying a block of shares in a Jersey Company which owns the Jersey Property. As such you are not acquiring freehold property but a share in a Company. You acquire the exclusive rights of use and occupation of the apartment and the obligations regarding the common parts through the Company’s Articles of Association. Whilst the way in which you acquire the apartment is different, in practice, the shareholder has similar rights to those acquired with a flying freehold apartment. As with flying freehold, the shareholder will have an obligation to contribute towards the common expenses and, again, this is usually collected by way of a regular service charge. A Company Secretary administers the Company’s records and is responsible for convening meetings of the shareholders, who are often also the Directors of the Company, to decide on management and maintenance issues.
Long leasehold apartments are quite unusual in Jersey. The original term of the Lease may be for many years but as the term decreases each year so does the value of Lease. The Lease will contain provisions for the maintenance of the apartment and usually for contribution to the maintenance of the common parts of the property. In recent years in Jersey some of the older States owned leasehold apartments have been converted to flying freehold ownership as a point had been reached where the number of years remaining on the lease was too low for a lending Bank to grant a mortgage.
When you agree to buy, your Parslows Jersey lawyer will review all the Association, Company or Leasehold records to ensure that you are fully advised on your rights and responsibilities, financial obligations and that you are appraised of any issues arising. These can be complex transactions involving a lot of paperwork so it is important to choose your lawyer carefully so that you can be sure a thorough job will be done, allowing you to start climbing the property ladder with confidence.
Lindsey Power | Conveyancing Manager| Residential Property Lawyers
For advice, assistance or further information on first time buyers please do not hesitate to call 630530 or email us on email@example.com or call 630530
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