Offer Accepted / Lease + Freehold

Jeffrey_Shaw

OK- that makes sense. Thank you.

taskerl

Vetyver wrote: »

If the OP's situation is the same as mine - which I think it is - then the two flats used to be one property, but have been converted into two self-contained flats. We're buying one of the floors as a self-contained flat; the other floor is being sold simultaneously to another buyer.

I was told the same thing - that is, first, the leases are being extended to 125 years, then we need to buy the share of freehold separately, after completion.

Do i have to buy the share of the freehold? or just leave it as a 125 year lease? just thinking about when it comes to re selling

Jeffrey_Shaw

taskerl wrote: »

Do i have to buy the share of the freehold? or just leave it as a 125 year lease? just thinking about when it comes to re selling

No, unless V makes it an inescapable term of granting the lease, you're not obliged to buy any share of the f/r. But see post #10 and my recommendation there.

Vetyver

Jeffrey_Shaw wrote: »

OK- that makes sense. Thank you.

Oops, didn't see your reply when I posted

Jeffrey_Shaw wrote: »

A pleasure to assist.
By the way, do try to obtain the f/r [in the two flats' lessees' joint names].
That way, they the outgoings; and no-one will seek to make a profit from them.

May I follow with a question - you were exactly right in your post, V is selling the remaining two and wants to get rid of its entire freehold estate. Now, V is apparently setting up a management company for the shared freehold, which I understand is one of several ways that the freehold may be transferred - is it the best way? If not, what would be better? Also, what of this £1 vs £1k for the share of freehold - I understand what you mentioned about the value of a freehold reversion, but a thousand ponds is a massive difference! Is this a figure that the V sets?

Jeffrey_Shaw

Yes, the price is whatever V sets. I suppose that it reflects the ground rent income.

As to who acquires the f/r, a company is needed if there are more than four flats.
But it can be avoided if there's only 2/3/4; the lessees [one per flat] can then hold it as a 'partnership'. .

Vetyver

Jeffrey_Shaw wrote: »

Yes, the price is whatever V sets. I suppose that it reflects the ground rent income.

Interesting. The ground rent is only £120 per year! Thanks for that, this could potentially make for an interesting chat with the EA.

Jeffrey_Shaw wrote: »

As to who acquires the f/r, a company is needed if there are more than four flats.
But it can be avoided if there's only 2/3/4; the lessees [one per flat] can then hold it as a 'partnership'.

I see. Would you say that a 'partnership' is more preferable to a freehold 'company', on a day-to-day basis, or when selling on?