Buying or renting at LCH - the legal stuff
Forgebank and Heron Bank homes - are they leasehold or freehold?
‘Forgebank homes’ refers to all the 35 homes to the right (east) side of the Mill in the site plan. These are leased to members by Lancaster Cohousing on a long 999 year lease (from 2012).
‘Heron Bank homes’ refers to the 6 homes to the left (west) side of the Mill. These are freehold. They are built to the same design and passivhaus standard as the downstairs living 3-bedroom Forgebank homes. Each one has a small private garden and a parking space.
Are any of the homes for rent?
Most of the homes are owner-occupied. In 2021 Lancaster Cohousing purchased a first floor flat, with loans from members, to rent out longterm for people who might otherwise not be able to live in cohousing. There are some other long term and short term rental options within the community which sometimes come available. Join our mailing list for news.
Can anyone buy or rent a home? Do I have to be a member?
To buy or rent a Forgebank (leasehold) home, you must first go through our membership process and have been accepted as a member of LCH before you can complete your purchase or rental agreement. To find out what this involves, see How to apply to join.
You don’t have to be a member to buy a Heron Bank (freehold) home, but you are welcome to apply at any stage before or after your purchase is complete.
What does membership entail?
All members have the same community rights and responsibilities. Becoming a member of the community entitles you to take a full part in the life of the community, using all the shared facilities, and joining in the shared decision-making. If you rent workspace at the Mill, you may be granted reduced rates. You can use the Food Store, the Guest Rooms and the Car Club.
In return, you undertake to abide by all our agreements, pull your weight in the essential work that needs to be done to maintain the community, and of course pay your service charge and utility bills. A signed application form forms a covenant to abide by our rules and agreements.
Do other members of my household have to join?
Only owners and tenants of the leasehold Forgebank homes have to be members. All other residents can choose whether to apply. We warmly encourage them to do so, so they can be fully part of the community
What if they choose not to be members?
(under review in Sept 2020)
Residents who are not members are welcome to contribute to community activities and have the option to join open membership clubs such as the car club, but their access to the shared facilities and spaces may be limited. If they are living in a leasehold home, they must abide by the terms of the lease, such as the private car arrangements. The leaseholder is responsible for explaining these terms, and for ensuring their compliance. After a non-member has been living in a leasehold house for 6 months, the leaseholder will be charged a portion of the service charge for them.
How do I apply to be a member?
To find out what this involves, see How to apply to join.
What sort of lease is it?
The Forgebank lease is a standard lease which runs for 999 years, starting in 2012. It defines the relationship between the leaseholder and the company. It’s a type of lease understood by mortgage lenders, often used for ordinary flats and apartments, with additional provisions to reflect the special needs of an ecological cohousing development. The leaseholder is responsible for ensuring that other people living or staying in their home also understand and abide by the terms of the lease. You can find an example lease here.
Can I buy a property to let out?
If you’d be interested in buying a property to let out (and perhaps to live in yourself in due course), please talk to us: we would welcome the chance to increase the number of properties for rent. We have a lot of enquiries from people who would like to rent here, and maintain a list of people who have expressed interest. You and your tenants would need to be accepted as members of the community. Ask to see Renting Guidelines for leaseholders.
Can a leaseholder take in a lodger?
Yes, subject to certain conditions. A lodger is someone who pays to share a Forgebank leaseholder’s living space as part of their household. Ask to see Lodgers - guidelines for leaseholders.
Utilities
Lancaster Cohousing is its own electricity supplier. Each household is metered separately for heating, hot water, and electricity. Meter readings are recorded by Building and Utilities Service Team, and households are billed quarterly by our Finance Service Team.
Note that residents of Forgebank and Heron Bank do not have the option of changing their energy supplier.
United Utilities bills each household for water.
Which companies have given mortgages on the properties?
Originally, some building societies would not fund a mortgage because they didn’t understand the concept of cohousing. However The Ecology Building Society and Nationwide have both loaned to residents. The Ecology gave a discount for the Code for Sustainable Homes being achieved.
Is it possible to do equity release on a Forgebank home?
In principle yes, as equity release is just a type of mortgage. No one has actually tried it yet though, and it would be subject to the lender being happy with the cohousing lease.
Is maintenance of the individual homes covered in the service charge?
Forgebank leaseholders pay for buildings insurance and external maintenance of their home through their service charge; Heron Bank owners are responsible for their own external maintenance and insurance (and pay a reduced service charge). All householders are responsible for their own internal maintenance and contents insurance.
Can you get insurance as you are so near a river?
Yes but not from all insurance companies. We get advice from broker Mark Whiteman at Reid Hamilton in Lancaster for our company insurance and he can also provide quotes for individual householders. Mark understands the site and our structure and has a copy of our flood risk assessment - which might make life easier. Other people have used other insurers.
Can you recommend a local lawyer?
You draw up a contract with the seller or landlord, as with any normal home. Several of us have used Nigel Parkinson from PD Lawyers in Lancaster. Others have used Sharon Massiter at Holdens in Lancaster. These two solicitors are familiar with Lancaster Cohousing so that tends to make the process easier
What happens if I need to sell?
When the time comes to move on, a member can sell their leasehold or freehold on the open market.
A prospective leaseholder buyer would need to be accepted by members, and jump through the same membership hoops as the seller did when they joined. The Membership Team work with a seller to help them find someone who will make an active and enthusiastic community member.
In the unlikely event that members don’t accept a prospective purchaser, who meets all our requirements, as a member, we then enter a process where, if no other acceptable buyer can be found, the company itself must take on responsibility for buying the property. This has never happened (as of December 2020).
Membership ceases on the completion of the sale of the leasehold or freehold.
Is there anything additional to pay on selling a home?
Apart from settling any outstanding bills, there is a transfer fee (or ‘levy’) built into the lease which is payable by an outgoing leaseholder equivalent to 1.5% of the selling price. This goes into a Community Fabric fund, and is intended to reflect the value of living in the community with all its shared facilities. In practice, this has been applied only where it would not mean that the sale was at a loss. We are in the process of reviewing this fee (March 2020). Meanwhile, it continues to apply to leaseholders, but any ‘equivalent levy’ fee is waived for outgoing Heron Bank owners.
If anything happened to the company, what is the liability of each member?
If LCH ever has to be wound up, a member’s liability is limited to £1.
Am I free to bequeath my leasehold home to my chosen inheritors?
Yes. The person who inherits your LCH leasehold property automatically becomes a leaseholder member of LCH. This is the only situation in which someone could become a leaseholder and live here sharing the community facilities without going through the membership process and signing up to our values and agreements. To avoid potential difficulties after your death, please discuss this with your inheritor(s), and consider including an instruction in (or with) your will that, if they don't share the LCH vision & values or wish to take on the commitments of LCH membership, they sell the property. Please ask for a statement to keep with your will.
