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Need more information regarding legal documentation and what each kind is? Take a look at the points below.
Leasehold means that the property owner has obtained a lease from the freeholder/landlord to use the property for a specified number of years. The leases are usually long term, often 90-120 years but can go as high as 999 years.
Freehold means that the property owner is the freeholder or landlord, owning the property and the land it stands on in perpetuity. The type of freehold ownership depends on the transfer held – part or whole.
A lease is a contractual agreement between the property owner, freeholder and, in some cases, a management company, outlining the obligations of all relevant parties.
Q: Transfer of Part (TP1)
A Transfer of Part (TP1) is a contractual agreement between the property owner, the ‘transferor’ (the original owner of the land) and the management company. It outlines the obligations of all relevant parties.
For example, a TP1 would be the legal document used for a freehold house on an estate; the property owner would own the house and the specified land around it while the original developer or landowner would own all other land not covered by a TP1.
Q: Transfer of Whole (TR1)
A Transfer of Whole (TR1) is much like the above, but covers the ownership of all land included within the property. This would be held by the developer, freeholder or management company, depending on who the current owner is.
Q: Management Agreement
The management agreement is the contract held between ourselves as the managing agent and the instructing client – be that the landlord, freeholder, resident management company or developer. It stipulates what services we will perform for the stated management fee, as well as what services will be charged separately.
The agreement will also include details agreed in advance with the instructing client. This includes the number of visits we will make each year, the number of meetings we will hold and the fee we are charging for providing the service. This fee is calculated on a per unit basis plus VAT.
Our standard agreement includes sections for HML Company Secretarial Services and HML Concierge Services, and we have a separate agreement in place for collecting ground rent or insurance premiums on behalf of the landlord.
Our term is one year less a day, with a three-month notice period. Each year we’ll issue an updated agreement to the instructing client.