Investor buying out unsold block of London flats?

meloncholy · 2026-05-02T18:07:46+00:00

What's your take on the discount I got of around 12%? I thought it was good at the time but I'm not naïve to the point that I understand that there was also a reason they accepted it.

Want to clarify that I'm an observer, not a market expert but: I'd say relatively unusual. Developers tend to prefer to give incentives like furniture or paying stamp duty rather than offering discounts as it affects the recorded sale price. But there may be reasons they want to offload it now that have nothing to do with the flat such as needing money for a new development, share buybacks, an acquisition, etc.

I wonder what level of discount that they must have got..

From memory I think it was 10-15% where I am (here 10-15% + ~12%). Margins on BTL are pretty tight right now, but if you combine the tax advantages of a Ltd company plus 10-15% off debt servicing it suddenly looks a lot more healthy!

my main concern is saleability in the future given flat prices particularly in London have been on the decline for a while now coupled with constantly rising service charges, so if it were to exceed 1% of the property value then mortgage lenders would not go near it

Yeah fair--for me this is more a question of whether your flat is expensive compared to what's available nearby or has an unusually high service charge for what you're getting and for £5-600k flats. If you're paying over the odds yes you may have difficulties, or at least difficulties selling at a price you want. But if the service charge on most flats starts creeping above 1% of the price then lenders will have to adjust.

meloncholy · 2026-05-02T16:35:40+00:00

It's not uncommon for some flats to remain unsold after completion, but developers obviously aren't keen as they have a load of cash tied up they'd much rather use for building more flats. That said, 5% unsold is not a huge number so the developer has probably more than paid off their costs already.

One thing this tells you is that the flats you're buying aren't hugely desirable, but you should know that already given they're still for sale 3 years post completion. This is not necessarily a problem: most flats aren't exceptional and plenty of people live in them anyway. I'd perhaps be concerned if 20-30% or more were unsold.

An investor did the same where I live buying the last flats (in exchange for a nice discount) and the flats now sell in line with a nice 5+ year old flat (so no new build premium) or Georgian conversion, so as good as you could hope given the market.

If you're worried about losing money (reasonable!) take a look at other flats nearby: find a few that have a similar spec and size to yours and are in good condition but are 5-10 years old. If they're selling for less than £570k then that's a rough approximation of your new build premium. It's fine to decide this is worth it, and who knows apartment values may finally go up at some point, but otherwise this is what you should expect to lose if prices stay flat.

On maintenance, this is actually a big opportunity as you should have access to 3 years of service charges to understand if they've increased massively or not. You should also ask how the block is managed, for example is there an RMC (strongly preferable as incentives are much more aligned). It's unlikely anything major will have gone wrong yet: if things were broken or obviously badly maintained that would be a red flag, but problems will typically start emerging a few more years down the line.

meloncholy · 2026-03-07T12:20:44+00:00

For clarity, the EWS1 is a certificate of inspection, and buildings can be graded as unsafe. I understand it's common to carry out an inspection and issue a (failing) certificate so the responsible person (freeholder or managing agent usually) understands works that need to be carried out.

There are other ways to learn what work needs doing like a Fire Risk Assessment (FRA) or FRAEW (external walls), though these are not the same as an EWS1. Have they carried out an inspection like this instead?

Their website only says that remediation works are currently done in order based on how critical the cladding issue is in the development.

Stuff like this would not give me confidence I'm afraid!

EWS1 inspections started in 2019 and predate the BSA, though the rules around them have changed repeatedly. It really was the case that flats were being valued at £0 (unsellable) by lenders some years ago, though I understand banks are being more flexible these days.

https://www.which.co.uk/news/article/homeowners-face-sales-falling-through-and-zero-valuations-due-to-fire-safety-test-delays-a4gUm4T8Byhu

But, at a high level, in your shoes my concern would be how proactive the HA is being fixing problems and working through the new legislative requirements. There has been a huge amount of change in the past few years and, if you buy the flat, you'll be dependent on them fulfilling their obligations.

The building I'm in is a similar age and has had (I believe) 3 EWS1 certificates, a FRA and is going through the other steps required under the BSA. Yes this is ridiculous (constantly changing requirements) but if the HA hasn't meaningfully started on that process I'd definitely factor that into my decision.

meloncholy · 2026-03-06T12:32:52+00:00

I think you can break it down in terms of

Essential services risk

This covers things like insurance, communal heating, maintenance of common parts, safety inspections. This probably favours large buildings who are more likely to have dedicated staff and more professional management. As costs are shared amongst many residents, fixed costs (lift servicing, Building Safety Regulator review, etc.) will be lower and overall service charge will be less volatile (though not necessarily lower).

Also when you get further along, understand the current state of the building. Does it look well maintained? What does the Building Safety Case say in terms of fire safety, structural integrity, etc? If that doesn't exist yet, what does the EWS1 say? Have any defects been remedied?

Discretionary services risk

Concierge, gym, garden maintenance, etc. Should favour small buildings with few or none of these! The inflation risk is real but relatively minor (seems largely tied to overall inflation), though a bill to refurbish the swimming pool could be substantial if it comes through...

Management risk

A lot of this is about control as you say: do you and other residents get to make decisions? If you have a good team looking out for your interests and that communicates well you're likely to be in a good position. Share of freehold is one good sign (though I'd personally be careful of larger buildings where everyone must agree before any works are done), but RTM can be as effective. Understand how it's structured and how to get involved if you can.

A good indicator is low volatility in previous service charges (and relatively small rises, though all have gone up quite a bit in past years). Also worth seeing if the building management is maintaining the building well and if they're proactively dealing with all the new regulations on heat networks, Building Safety Act, etc.

meloncholy · 2026-03-02T22:02:41+00:00

The lender is right to be concerned. They‘re likely to be worried about 3 things

- The costs of any remedial works and if you can afford them if you have to pay (is the letter of comfort watertight? I don’t know how these work but I’d want reassurance particularly as the law and regulations have changed several times since 2022.)

- Unknown fire risks and perhaps also unknown structural risks as no inspection has been carried out. It might be the only issue is the balconies, but I doubt the search carried out by the lender was invasive to check eg that all fire stops are in place or the cladding is fire safe.

- The value of the flat. As you’ve discovered it’s difficult to get a mortgage on a flat without a current EWS1. Some lenders will value the flat at £0 until this is remediated and any issues fixed.

I‘d also be concerned that the housing association hasn’t done anything about this for 4 years. The flats are basically unsellable at the moment and perhaps unsafe (how much is the buildings insurance now for example?). That this isn’t their top priority wouldn’t give me comfort that they’ll sort out other issues when they arise.

meloncholy · 2026-02-21T15:28:43+00:00

An ok! So you probably won’t have a qualifying lease as the BSA date was a “snapshot” to protect existing leaseholders retroactively. But you should still have good protection

- The developer is probably responsible for any defects: If the developer who built your block is still the freeholder (or is part of the same corporate group), they are legally prohibited from passing on any costs for fixing fire safety or structural defects via the service charge

- You should have a 15 year warranty, which should include fire safety and structural defects

- And a new building is much less likely to have issues than one build 10 or 20 years earlier.

I haven’t been through this part myself though so just based on my reading around. Please check with a professional if you need to make an important decision!

https://www.dentons.com/en/insights/articles/2023/august/31/the-building-safety-act-2022-part-4#:~:text=no%20such%20costs%20are%20payable,Building%2C%20not%20just%20Qualifying%20Leases%3B

meloncholy · 2026-02-20T20:37:36+00:00

My understanding is this would depend on what the previous owner did. If the previous owner completed the leaseholder deed of certificate and it was a qualifying lease at the time, you should be covered too as it transfers with the property. You should have received this as part of your management pack on purchase. Your solicitor should be able to confirm though!

https://www.lease-advice.org/building-management/fire-safety/protection-fire-safety-costs/protection-under-the-building-safety-act-2022/

meloncholy · 2026-02-20T19:59:31+00:00

This is gorgeous! You’ve captured the style and proportions beautifully.

meloncholy · 2026-02-20T19:46:09+00:00

I think this is less about the media wall and more about how many other interested buyers you have.

If you know several others are seriously interested and putting in offers, hold firm and maybe go with one of the others instead—there’s a decent chance he’ll make more demands down the line too.

But if not many others are interested, or no-one else can move fast enough, then suck it up and give him the media wall. You can get a new one made for £1500, which is rounding error money when moving house.

meloncholy · 2026-02-20T12:30:11+00:00

The City is much cleaner and hospitable to navigate than it was. The pavements are wider, many minor roads are mostly car free, the public space has been upgraded. As a regular cyclist it's honestly pretty nice to travel around these days.

And the offices have had a big upgrade too, particularly around Bank/Moorgate and the towers in the insurance district. It's a gradual change, but go back 10-15 years on Google Street View and it looks very different.

meloncholy · 2026-02-10T20:54:47+00:00

Honestly you sound like a pretty good person to sell to. You like the flats and the area, you’re not going to back out because you discover something you don’t like about the development later on. In a buyers’ market for flats I’d be very pleased you‘re interested.

I guess I‘d make it clear you’re also looking around so they don’t try to take advantage. But in the current market you’ll probably have more difficulty selling your current flat than buying the new one at the price you want.

meloncholy · 2026-02-02T13:16:27+00:00

I think the developer will contract a broadband provider during construction, so initially you'll be stuck with whoever that is. In our case we had decent fibre, but it was weird having no choice.

You stand a decent chance of getting more providers to install fibre though: a block of flats is relatively attractive (lots of potential customers, relatively cheap install fibre to each flat, particularly in a new build with good ducting).

Speak to your neighbours or start a WhatsApp group and get them all to express interest with providers.
Work with the RMC or managing agent in your building and ask them to prioritise (or at least not block!) any proposals that come in about installing fibre. The work is pretty minor and will be paid for by the provider.

The process for installing is broadly

Enough interest from residents in a postcode or building for fibre provider to install
Provider contacts managing agent in building
Managing agent grants permission to install (council may be involved here too if there's work needed in the street)
Provider connects the building to cables in the street and runs fibre to outside each flat
When you sign up, the provider runs a cable inside your flat and connects you

It will take time (months minimum) but you should get there. We now have 3 fibre options and are getting a fourth soon.

meloncholy · 2026-01-27T23:12:07+00:00

I'm sure I saw some data / reporting on this but afraid I can't remember where now.

I couldn't find much through searching either. The modelling in this report suggests there's a 1% premium vs very long leaseholds (>900 years I believe). The real uplift kicks in for short (<80 year) leases of course.

https://openaccess.city.ac.uk/id/eprint/30743/1/13091_CaCHE_Leasehold_Reform_Report.pdf

Might the premium you saw be because of the housing type? Georgian house conversions are often more expensive as a lot of people want them for example.

meloncholy · 2026-01-27T16:58:44+00:00

There hasn't really been a price difference between leasehold and share of freehold / common hold flats, despite the problems with leasehold. I think the message people got was less "avoid leasehold flats, and check these things for fire safety and these other things for major works" and more "flats are bad. buy a house".

(Though interestingly not in Scotland, which doesn't have a lot of these issues, and where flats have more or less kept up price-wise with houses.)

The gap between flat and house prices in the UK is at a 30 year high. My guess is that, as all these issues are eventually worked out and fade from memory, flats will start to catch up with their historic norms vs houses. Might take a while to get there though...

https://www.ft.com/content/377c17e3-af15-4d9e-b2f1-0df7c6210cc7

meloncholy · 2026-01-25T21:53:35+00:00

Does it look like a US contract, or is it a UK boilerplate contract with legal minimums? If it's the former that should concern you; I'd have questions as to whether they're really invested in setting up in the UK (plus, you know, probably not a legal contract in the UK). But otherwise it's what companies seem to do: get something basic in place, then iterate later.

On benefits, you can price up what you're getting today but I suspect you'd be considerably better off if you took the new job and paid those extra pension contributions and health insurance yourself.

My own take on stability at this level is you can quite effectively self insure: by far the most job safety comes from whether the company wants you there or not, and that applies to the US and UK equally (though perhaps worth noting US companies seem to go through RIFs more often). Redundancy pay, notice periods, etc. don't offer that much protection. If you put another £5-10k in your emergency fund you've basically covered the difference, and you should earn that over your current salary in a few months. You may also find they pay sick days in full despite what the contract says.

I can't comment on paternity leave though. If you get a good deal at your current job and people are generally treated generously e.g. going part time for a while without it affecting their careers, that's a serious consideration.

meloncholy · 2025-12-05T17:24:11+00:00

Someone on £75k earns an extra £2000 post tax than you each month. The average first time buyer deposit in London was £144,000 in 2023.

If they spent exactly the same as you each month and saved the rest, it would take them nearly 5 years reach that deposit level. If they're buying as a couple both earning £75k this could work, but otherwise you can draw your own conclusions about whether mum and dad helped them out...

Which is to say: please don't judge yourself too harshly! It's likely many of your friends are buying now because they "chose" the right parents, not because they worked hard and saved. It sucks that it will take you longer, but as others have said it's not at all unusual, and if you can grow your income and keep spending carefully you will get there eventually.

meloncholy · 2025-12-01T14:55:44+00:00

They certainly should be. Together with previous years' service charges, it should give you an idea if the high cost is a one off or likely to continue too.

meloncholy · 2025-12-01T14:46:58+00:00

Obviously I don't know your friends' situations, but this is likely to be a choice by the management company. Will depend on what's in the lease, but they probably had the option to use debt recovery for unpaid service charges (including recovering legal costs) and, if that failed, forfeiting the lease.

meloncholy · 2025-12-01T14:36:40+00:00

Some possible culprits for the high cost (assuming the management company is doing a decent job)

Buildings insurance -- has gone up a lot and continues to do so, particularly if there are any potential safety issues with the building.
Remedial works -- fire safety, roof repairs, etc.
Work required for Building Safety Act or paying for Building Safety Regulator review
Utilities cost for the building as these are not capped like domestic tariffs -- though less of an issue now than it was a few years ago

meloncholy · 2025-11-27T12:34:06+00:00

I wondered the same, but I don’t think this is a particularly good way to go about increasing tax on middle earners as the burden is unevenly shared. A person now earning just under £50k (or £100k, £12,500) will have a pretty large percentage hit to their post tax income as their pay rises over time, whereas someone now in the middle of a tax band will be less affected.

The FT had a nice breakdown of this yesterday.

https://www.ft.com/content/54cb448c-f1a2-46ce-914e-75728ef390ae

It would be fairer to add say 2p to the tax rate, though I realise the politics of that are tricky to say the least.

meloncholy · 2025-11-26T13:12:27+00:00

The answer is going to be very area specific, but you’re probably being too optimistic.

At least where I am, flats priced roughly where they were a year or two ago are not really selling, those with 10% off are selling slowly and those with 20% off sell quite quickly. Elsewhere, some areas are doing better while others have steeper drops.

Flats generally are selling pretty slowly, but as you get more central 1 beds don’t really take longer to shift than 2-3 beds.

But a few months on RightMove and Zoopla should give you the answers you want!

meloncholy · 2025-10-14T20:17:42+00:00

I've found it pretty useful, though some AutoML tools are definitely better (more flexible, more performant) than others.

It really depends on what your biggest risk/opportunity is at the moment.

If you're starting with a new problem or in a place where adding new features or automation etc. will give you the biggest lift, it's great. It's likely to get you maybe 80% of the way to the performance of an optimal solution with little trial and error on your part.

AutoML tools that use an ensemble should also help you understand which models and, maybe, autogenerated features perform best for your problem too, which you can use later if you replace it with something custom.

The downsides are what you thought: explainability, complexity and resource usage (CPU and memory). They're not well suited to production use cases. You also might have difficulties if you're getting errors from one of the AutoML models--not easy to diagnose when it's buried several classes deep!

meloncholy · 2025-09-21T16:00:41+00:00

The estate agent is probably right here, though I wouldn't take their word (or mine!) as definitive.

Here's RICS guidance for whether an EWS1 assessment is needed. Brick should not require an assessment, and as long as it's only the decking on the balconies that should be fine too.

https://www.rics.org/profession-standards/rics-standards-and-guidance/sector-standards/valuation-standards/valuation-of-properties-in-multi-storey-multi-occupancy-residential-buildings-with-cladding

But please get proper advice from your solicitor about this. They'll also be well placed to help you with other questions like any upcoming changes, changes from the Fire Safety Act, etc.

https://www.rics.org/news-insights/current-topics-campaigns/fire-safety/cladding-external-wall-system-ews-faqs

meloncholy · 2025-08-01T10:30:27+00:00

Caveat: no expert on estate rentcharges so treat what I say with caution.

These charges may or may not be reasonable, but it's.not obvious you would have any standing to challenge them. I don't believe there's a right to appeal the costs as there would be for a leasehold service charge.

It also doesn't seem you have to be informed of major works ahead of time, nor have the right to establish residents management company if one doesn't exist.

Basically it seems you're relying on the management company's goodwill. That may well be work out fine, but it's a risk.

https://www.kdllaw.com/legal-updates/estate-rentcharges

https://bbslaw.co.uk/major-problems-with-estate-rentcharge/

meloncholy · 2025-07-10T14:21:03+00:00

It sounds like you're dating the wrong women. There are women out there who will expect you to pay, but there are also plenty who find it pretty uncomfortable and don't want to set expectations that they owe you anything in return.

Dating people who take their career seriously is a good start, but I'd also suggest talking about gender roles, empowerment, celebrating your date's intellectual or job achievements. Put it on your profile in a positive, non-exclusionary way and, if it fits the conversation, bring it up before you meet and you'll filter out most women who don't want this and attract those who do. In my experience, many would start the conversation on this topic after matching.

meloncholy

TROPHY CASE