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ground rent doubling every 25 years
100saving
Posts: 314 Forumite
I'm buying a flat from the freeholder. Once we complete he will grant a new 125 year lease but he is saying the ground rent which is £150 will doubling every 25 years!
Is this normal? Even though we have agreed a price and everything is going okay I’m a little unsettled about the ground rent doubling every 25 years. I'm planning on owning this flat as a BTL for a very long time so I would be paying £300 in a few years.
has anyone else had something like this before?
Is this normal? Even though we have agreed a price and everything is going okay I’m a little unsettled about the ground rent doubling every 25 years. I'm planning on owning this flat as a BTL for a very long time so I would be paying £300 in a few years.
has anyone else had something like this before?
Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)
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Comments
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Is this normal then? I have not brought a leasehold property before.Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)0 -
Doubling once every 25years actually doesn't sound like a bad deal.
It gives you certainty and is better than ambigious terms that don't specify how much it can be increased or how frequently.A smile enriches those who receive without making poorer those who giveor "It costs nowt to be nice"0 -
Doubling every 25 years is very common for newly created flat leases.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.0 -
Richard_Webster wrote: »Doubling every 25 years is very common for newly created flat leases.
Thanks, out of intrest is it common for new leases not to state service charges? and if so can these be fixed or do they change year to year? what happends if this year its £100 then next year the freeholder says they want £1000?Age: 24 / London/Ireland / Salary €49,000 / 1 London BTL (8% yield) / Total savings pot £12k+
Lloyds Club CA £5,000 @4% / FD Regular Saver £3,600 @6% (12 of 12) / TSB Classic CA £2,000 @5%
Clydesdale Direct CA £1,000 @2% / Santander ISA £700 @0.5% / Premium Bonds - £100
Halifax Reward CA (£5 per month) / Santander 1|2|3 CC (cashback)0 -
Mine's going to increase by a factor of 6 or so next year (£40 to ~£240), as the ground rent is adjusted every 25 years to a percentage of the value of a 125 year lease on the property. I'd be happy with doubling!Let's settle this like gentlemen: armed with heavy sticks
On a rotating plate, with spikes like Flash Gordon
And you're Peter Duncan; I gave you fair warning0 -
Doubling every 25 years sounds pretty good to me!
Do the maths... (much less than inflation!)Should've = Should HAVE (not 'of')
Would've = Would HAVE (not 'of')
No, I am not perfect, but yes I do judge people on their use of basic English language. If you didn't know the above, then learn it! (If English is your second language, then you are forgiven!)0 -
The place I'm trying to buy has the ground rent increasing by £200 every 25 years so not as bad as your terms but most I've seen do seem to include some increase every 25 years.
However you are unlikely to own it for more than 50 years so the most it will ever be for you is £300/year. Also you could try over the next 25 years to convince the other owners to buy the freehold with you then you don't have to worry about the ground rent.Starting Mortgage Balance: £264,800 (8th Aug 2014)
Current Mortgage Balance: £269,750 (18th April 2016)0 -
Some ground rents on new flats increase yearly or sometimes three yearly in line with APR, by the time cumulative percentages have been added this could be a lot more than double!0
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Double every 25 years is good value IMO.0
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