Buying a house with a leasehold

germaki

I've found a house that seems to tick a lot of boxes, at a fab price which is making it more attractive. I have since found out that it's a leasehold rather than a freehold which I understand is better.

Is there any issues buying a house with a leasehold? I don't know how many years are left on the leasehold, will have to wait till Monday when I can speak with the agent.

Thanks.

sirmosh

There are potential issues, mainly surrounding the length of the lease and renewing it. Sometimes unreasonable service charges are a pitfall of buying a leasehold property although that's more to do with flats rather than houses.

I understand in the North leasehold houses are quite common but I've only ever seen flats leasehold in my area.

germaki

Thanks for your reply, I won't be able to find out how long is left on the lease until I ring the agent tomorrow. I guess I also need to find out if there is any ground rent to pay and how much.

The house is a traditional terraced house, and was surprised to find on the particulars that it was a leasehold as I thought that it was typically with flats that came with leaseholds.

Does anyone have anymore advice or experience with buying a house with a leasehold? Can a leasehold be brought and turned into a freehold?

motherofstudents

I have only ever bought one freehold house. As stated above a lot of areas are mostly leasehold houses. Our ground rent is £5 a year and the remaining lease is for 930 years. It is not something most people think about as it is so commonplace but I can understand it is not the same everywhere. I would ask your conveyancing solicitor about how to buy the freehold although I think you have to wait for about two years ?

LandyAndy

motherofstudents wrote: »

I have only ever bought one freehold house. As stated above a lot of areas are mostly leasehold houses. Our ground rent is £5 a year and the remaining lease is for 930 years. It is not something most people think about as it is so commonplace but I can understand it is not the same everywhere. I would ask your conveyancing solicitor about how to buy the freehold although I think you have to wait for about two years ?

My first house was in Chorlton (Manchester) and was a 999 year lease from the 1930s with a £4pa ground rent. As you say, it is the norm with older properties in the area. Never gave us a moments concern.

My 3rd house was a 125 year lease from the 1980s in Warrington with a £35pa rent. Again no problems in ownership and no problems when we sold in 2005. We could have bought the freehold for (I think) a few hundred pounds but didn't.

amyjay_2

We have just bought a leasehold property (it's going through at the moment) it has 61 years left on the lease which we found to be problem in the first instance as there arent many mortgage places that will offer you a mortgage on less than 70 years. We are now going with nationwide and all is fine. We have looked into it and we can buy the freehold in two years for roughly £3000. The service charge is very minimal. Hope this helps.

zaksmum

Bellway Homes on Merseyside are selling a whole estate of new build houses (Roby Park) as leasehold properties.

There's ground rent to be paid and management charges too.

This put me off buying a house from them.

girl_withno_name

One house that we're interested is a leasehold (which is unusual in this area) - I'm waiting to find out how long is left on the lease but do know that the ground rent is £22.50 every six months...
Is this money literally just for the 'luxury' of keeping your house on the land?
Is the ground 'landlord' responsible for any sort of ground maintenance?
Would it put restrictions on alterations / modifications / extensions to the property?

germaki

I have called the agent and they have advised me that there is 980 years left on the lease, and the fee payable each year is just £3.

Like the previous poster, does anyone know if having a leasehold prevents you from extending a property or making any structural changes?

Thanks again.

bee78

Hello germaki,

I have posted this question before, never really got an proper answer, cos of the legalities involved. But i do have some information.

Leasehold is more common in the northwest than any other area.
A leasehold house can be made freehold. the cost would be ground rent * no years the freeholder request and this is up for negoitians. If you are buying new build(that is from a builder)which is leasehold, and you want it freehold, negoiate from the start,most builders will throw in the freehold for free. If not, it would be ground rent*19-22years. Most ground rent for new build 4 bed detatched properties are around £200-300pa.

If you are buying a resale house, you can ask the vendors to buy the freehold for you or on your behalf, as it will be easier for them to purchase the freehold as they are the current owners. If you are going to be buying, you would probably need to own properties for 2 years before you can do this, and there will be more legal complication if the property is less than 80years and it will be more expensive to pay for the freehold if the lease is less that 80years.

another way to do this if the property is a resale, is to ask your solicitor to approach the freeholder to ask for price for the freehold. You solicitor will charge extra to do this, and then maybe you can negoiate the asking price of the property with vendors making adjustments for the freehold price.(just a thought)

So to answer you question, yes it possible to purchase the freehold, but you have to decide wheather it is worthwhile!!!:cool:

vax2002

If you buy a lease, you effectively buy a contract that allows you to live in the property, the bricks, the land, the walls, the roof belong to someone else who you RENT them from.
These rental charges can be increased and you can be charged for any work on the leaseholders property you live in at any rate they see fit.
It is not better in any way shape or form, it is leaving the builders an IV line straight in to your bank.