Bargain flat - owner a PO Box in Panama

hanni

Hello wonderful MSEs,

I've already consulted numerous forum posts on a variety on topics in the process of getting myself on the property ladder. But now that I've had an offer accepted, I find myself with a conundrum that I doubt existing posts can help me solve. I would really appreciate your advice.

The situation is this:
I've just had an offer accepted on a bargain 2 bedroom flat in London and I've started the purchasing process. Yay.

But then I started doing some research of my own and what I found has has me alarmed and worried.

The Land Registry leasehold details for the property show that the owner's registered address is a PO Box no in Panama. No name, but some mysterious corporation listed.

What's more, the flat is registered to have sold for £35,000 more than what I'm to buy it for, just under a year ago!

Until now, I have thought it last sold in 2006 for pretty much the price I've agreed to (based on information on sold prices information on sites such as FindAProperty.com and MousePrice).

It makes it seem odd that he (or rather this mysterious corporation) would sell for so little now and make a loss of at least £35,000?
It first came on the market in about October and at first asking price was a bit high for what the property is, but it was soon reduced by £20,000. But it didn't sell. According to the estate agent, it's the perfect rental flat, but not the sort of place people would buy as their home, so he claimed only investors had shown interest and that they hadn't been willing to pay enough. Only last week was it reduced another £25,000 after which I secured it for £2,000 above that (as it generated more interest in the flat, I went in just over to seal the deal).

Looking up the company listed as the freeholder on Companies House, I find that they are in the business of renting out flats.
I saw a flat in the same building as 'my flat' advertised to let on this very same company's website, when I was researching the property, so I suppose I'm a bit confused as to why they would sell the leasehold, surely there would be more money in it being their own rental flat?

Is this an unusual situation? Does it sound like there is something fishy going on? Or am I just being paranoid?
Could this make the purchasing process a nightmare or just very costly in solicitor fees?

I really don't know what to do. I don't think it's too late for me to pull out of the purchase if it's is indeed a risky situation, but I'm still hoping it's just my first-time buer nerves getting me all worked up about nothing.

Please help.

Many thanks in advance!

H

themull1

Would your solicitor not sort this out?

hanni

They would, or at least attempt it, but the question I'm asking myself is "Is it worth it?", "Am I just going to lose money on this?". I can't see the wood for the trees at the moment and I was hoping someone with a better head on them and some experience in property dealings could give me their point of view. Is this going to end well? Might it cost me a fortune in solicitors fees? Might it be a dead end?

I'd really appreciate your thoughts on the situation. I should mention though that so far it seem that the Estate Agent has had no problem getting a prompt response from seller, despite the Panama connection.

Thoughts?

H

dimbo61

House and flat prices have dropped in the last 12 months and the company may have been unable to rent it out and need to generate some money by selling some of there properties!
Take mum and dad if possible to have a look round and give you a second opinion as to " the perfect rental flat"
Has it got parking, size, location, transport links, views, noise ETC
Your solictor should be able to deal with the sale thats what you pay them for

themull1

At the end of the day, any sale can fall through. Its really whether you want the flat or not, but if the estate agent is getting replies, i wouldn't worry any more than any other sale.

hanni

True, very good point. Unfortunately no mum or dad at hand to help.

So you don't think I should be overly alarmed by seller basically being a mysterious corporation with only a PO Box in Panama?

Thank you!

dimbo61

You are already doing your research so carry on and take advice from your solictor and mortgage broker if you have one.
Check the management charges ???? and have a survey done and make sure you can afford the mortgage payments each month.
How long do you plan to live there ? think long term rates are low so consider 3/5 years fixed deals

hanni

dimbo61 wrote: »

You are already doing your research so carry on and take advice from your solictor and mortgage broker if you have one.
Check the management charges ???? and have a survey done and make sure you can afford the mortgage payments each month.
How long do you plan to live there ? think long term rates are low so consider 3/5 years fixed deals

thanks dimbo

I've checked services charges and ground rent with the estate agent and they seem perfectly manageable. Was think of going for a tracker mortgage actually, as it would work out cheaper than a fixed deal in the next 3 years even if rates were to go up 0.25% each quarter... That's for my situation anyways (HSBC Lifetime Tracker, 90%LTV).

You're right about the survey too, I'm thinking of getting a full building survey through my lender, is that a sensible way to go about it?

Thank you all for being really helpful!

ness_w

hanni wrote: »

thanks dimbo

I've checked services charges and ground rent with the estate agent and they seem perfectly manageable. Was think of going for a tracker mortgage actually, as it would work out cheaper than a fixed deal in the next 3 years even if rates were to go up 0.25% each quarter... That's for my situation anyways (HSBC Lifetime Tracker, 90%LTV).

You're right about the survey too, I'm thinking of getting a full building survey through my lender, is that a sensible way to go about it?

Thank you all for being really helpful!

I have no qualification apart from having had mortgages for nearly 25 years and would suggest that, once interest rates start moving, they are likely to go up by more than 0.25% per quarter.

dimbo61

All anybody knows about you "H" is that your name might be hanni and you live in SE LONDON
Age, job, income, pay rises, savings, deposit ( 10%) price of property, stamp duty if over £250K and lifestyle!!!! a saver or IT girl with big spending habits we would have to guess.
Rates are very low and the only way is up and you are on a HSBC tracker at 90% ( what rate?)
Are you planning on staying long term or is this the first rung on the ladder and you will want out in 2 years to the mansion in the country ( where I live)
If you went to see a "whole of market mortgage broker" he/she might find some good deals for you.
Think long term as your mortgage is 25? years or longer

ladylouise62

I wouldn't be too concerned about the drop in price - companies that invest often need quick cash and are willing to lose some money on a sale that they might make up many times more in a different investment.