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We've just had the invoice through for the groundrent on our house for the outragous sum of £2.50 for the year. 🙂
Along with this, it gives us the option to buy the freehold out for £397.29.
Is there any reason why i shouldn't buy it out? Yes we're not likely to be there for 159 years to cover that, but it does seem to mean we don't have to beg for permission if we want to make alterations etc.
What does STW suggest?
I'd buy it, you'd probably get that back with the house value jumping slightly
I'd buy it without hesitation. No issues if you want to do alterations to the house, it'll add value (potentially thousands, but comfortably more than the few hundred it'll cost) and make it much easier to sell. If it was a flat there may be complications but for a house, just do it. Just check if that is the price you pay or is it plus vat, land registry charges, plus legal fees etc
Any solicitors / land Reg fees on top of that? How long is the lease?
At that price, I'd be a buyer. Even if it cost £1000 in solicitors fees on top, it's worth it.
Edit: This is based on a house, for a flat it's more complicated...
If its a house buy it, if its a flat don't buy it.
Check check and check again that you're actually buying the thing. My dad was very close to buying his freehold but it was a scam and he's been paying ground rent to someone who didn't own it for the past decade.
Just had a quick scan of the letter and all looks legit, although i'll check against the contract to make sure it is the right folk.
With regards to the legal fees, it states the following: Our all inclusive price for the freehold, all our legal costs and final adjustment for rent. There is nothing futher to pay.
Does this mean we might still have legal fees on top?
Dave
For £400 100% buy it, even if your current ground rent is negligable and your current freeholder is decent there's no guarantee both these things won't change dramatically in the future. Given the choice I'd never buy leasehold again after the grief we had when we tried to sell our last flat.
Leasehold also seems to be the latest part of the property market identified as ripe for abuse by speculators keen to just gouge as much money out of people as they can.
We purchased our freehold on our current house when we bought new as it covered itself within 10yrs. 15yrs later its saved us a decent amount.
Had this convo with my wife recently and she pointed out that because some mortgages are becoming longer and longer term, some lenders wont lend on properties with lower than 50yrs left on them. Not an issue for you but where I live there are lots of early to mid 70's estates and I she has seen a few having trouble getting mortgages and as such selling them.
For that amount of money I would jump all over it as long as its legit
You may have to add your own legal fees to that, but I'd say buy it.
<span style="text-decoration: underline;">f</span>Is it a house or a flat - meaning what will be out of your control that you have to contribute to/can impact you
ie in a flat the other 99 flat holders all want the gold plated badger fur cladding (which the freeholder has to pay for)and it’s 50k per flat then it might prove tricky
I’d never buy leasehold again after the grief we had when we tried to sell our last flat.
Ditto, I'll never buy a leasehold again. The landlord was absent so we never had to pay any ground rent but it was a nightmare at selling time - in addition to costs there was hassle - including late night 3 hour drive to get a signature from someone the night before they went on holiday. Plus the stress that if that someone had done the sane thing and asked for time to read what they were signing, or wanted get a solicitor to look at it it would have held the sale back 3 weeks.
£397.29 will save the OP a ton of cash and a ton of hassle.
My only suspicion is why is the house leasehold in the first place? Is there a massive shared area or somesuch? If there is that might change the situation, but default answer is buy the lease.
Our lease is long lost and we paid a good fraction of that for an indemnity (which the next set of purchasers will probably also need...ad infinitum). So I'd say just buy it, one less thing for lawyers to get worked up over.
Thanks for the replies. Going to check through all the docs from the house sale as I remember somewhere details of who the ground rent needed to be paid to was listed somewhere. A quick google of the name and address on the letter seems legit. Just need to check out what other costs may be associated.
Now I have no excuses to start thinking about knocking wall down and extending a bit 🤣
Absolutely buy it ... and snap their hand off at that price
Yes, buy it!
If its a house buy it, if its a flat don’t buy it.
Flat or house, buy it. If the price is right.
Flat more so. Flats are still leasehold generally even if you own the freehold, but you're in control as the landlord or joint landlord.
If you're staying it can be a big saving in ground rent and potentially house insurance if you can arrange your own and landlords of flats may insist on their own insurance (big block of flats need dedicated insurance, a converted semi probably not and from experience your own insurance or a joint insurance is massively cheaper than landlords insurance. Mine used to insist on using his expensive contents insurance also. Until he died, then the freehold came up cheap so bought it).
Selling a flat would be sold with share of freehold and that's often attractive to buyers. Though you could keep the freehold and be the landlord 😉
House would be expected to be freehold and not having is a big deal breaker. I'd never buy a house leasehold.
House would be expected to be freehold and not having is a big deal breaker. I’d never buy a house leasehold.
Me neither, but all the new build houses on the new estates near me are leasehold. They're suckers AFAIC, they pay council tax to maintain roads and local amenities and then pay again to maintain their roads and their park which are all public.
The government are currently reviewing house leaseholds at the moment to determine fair charges etc.
Could work in the favour of many.
Either way this price is a no brainer, just confirm they are the title holder, you can do a land registry check for a couple of pounds.
Leasehold new builds are just a plain rip-off. There's no requirement to be leasehold other than to make more profit and hold home owners to ransom. Hence government intervention, though personally they should ban the practice entirely. A new build house (not flat) purchase should get you the land as well as the house, with a few rare exceptions.