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Simarc - bit of a legal question

edited 30 November -1 at 1:00AM in House Buying, Renting & Selling
3 replies 134.6K views
c0nn0r84c0nn0r84 Forumite
68 posts
edited 30 November -1 at 1:00AM in House Buying, Renting & Selling
Hi all,

Before I post I have already had a good look under "simarc" using the search function and have not found answer to my question so please accept my apologies if I have missed it.

I bought my 2 bed terrace off Barratt's and have been there 3 years in Oct 2010. The property was bought leashold (99 years) and I paid £135 per year ground rent (£5 discount for prompt payment). The house was priced at £119,650.

In Feb 2010 I enquired about purchasing the freehold from Barratts. They sent me a letter confirming that the cost would be 19x the annual ground rent charge plus their legal fees. Including my own fees of around £200 I calculated this to be around £3000 all in.

2 weeks ago (start of March) I received a letter from Simarc stating that back in December 2009 they purchases the leases from Barratts and that I now have to pay them for ground rent at £140.50. the letter was very blunt and, after reading the posts on here, it seems typical.

I called them up to pay and also mentioned I had been liaising with Barratts about buying the freehold and that I had a quote of 19x the ground rent. I asked if I could still do this and buy from them.

They said they would consider selling the freehold but they cannot honour the same price as Barratts. They said Barratts were wrong to entertain my enquiry in February as they had already sold everything to them. Additionally, they said if I wanted a quote they would charge me £47. They did say that they would consider refunding this amount if I proceeded with the purchase (big of them!).

What I'd like to know is are they able to charge what they want for my freehold or is there any legislation etc that I can refer to in order to keep the costs reasonable? It seems like these guys make their profits through ridiculous admin charges and bumping up prices so I'd like to know what my rights are. I don't want to instruct a solicitor to proceed with the purchase before I know I'm not at Simarc's mercy.

Secondly, if I purchase the freehold am I then able to wash my hands of these cowboys? I don't like the idea of paying a third party money.

Many thanks in advance and apologies if this has been covered. I have had a really good look, though.

Best,

Paul.

Replies

  • Richard_WebsterRichard_Webster Forumite
    7.6K posts
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    I don't understand how companies like Barratts can get away with selling houses on 99 year leases. Buyers should simply be refusing to touch them, insisting on freeholds.

    As to what they can charge for the freehold - there is legislation but it simply gives you a right to challenge the figures which in turn means paying a surveyor to give evidence as to what the figure should be. So it will come down to whether the figure suggested by Simarc is so high that it is worth the cost of challenging it.
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
  • c0nn0r84c0nn0r84 Forumite
    68 posts
    Thanks for the response - much appreciated.

    To be honest this is my first house so what I knew about that kind of thing could've been written on the back of the stamp. Leasehold over 99 years was the standard, though. At the time I couldn't afford the additional cost of purchasing the freehold. So didn't have any other choice as I needed to get on the ladder.

    I guess it's another way to make seemingly attractive offers more profitable for them. It's certainly the first and last new-build that I'll buy.

    I imagine on such a short lease the property value would be adversely effected if I tried to sell. As for my second question, do you have any opinion? Would purchasing the freehold ultimately sever any ties to Simarc?
  • Richard_WebsterRichard_Webster Forumite
    7.6K posts
    Part of the Furniture 1,000 Posts Combo Breaker
    ✭✭✭✭
    Would purchasing the freehold ultimately sever any ties to Simarc?

    Should do unless you are also paying a service charge for maintenance of open space, private road, etc.
    RICHARD WEBSTER

    As a retired conveyancing solicitor I believe the information given in the post to be useful assuming any properties concerned are in England/Wales but I accept no liability for it.
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