Just found out the house we are buying is leasehold

SouthLondonUser

The way I see it, it's also about propensity to risk. Even if the freeholder has been reasonable until now, there is still the possibility that the freehold may be sold to someone greedier. Even if ground rent is capped, a greedy freeholder may still overcharge you on insurance, management fees, etc. It's a risk. Only the buyer can know whether he's willing to accept it.

robynlouise

Thanks to all of you who have given me constructive thoughts and advice, it's very much appreciated! I'm going to a pen an email to our solicitor now to see if she can shed any further light on the situation.

hazyjo

davidmcn wrote: »

As above, it all depends on what the lease actually says. If it's an ultra-long term, with only a token rent, and minimal restrictions on what you can do with the property then in practice it's no more restrictive than freehold. In fact, many freeholds have even more restrictive covenants affecting them.

If it's a shorter term, the rent goes up exponentially, and you need to seek the landlords' consent every time you hammer in a nail, the value will affected accordingly.

Wouldn't make any difference to me - still wouldn't buy LH. Mainly because of onward sales - I wouldn't be able to explain all that to buyers, so I'd be limiting my market. I also just wouldn't want a LH house!


Appreciate it's common in some areas - that would be a different matter as future buyers wouldn't run a mile and would be more familiar with it.

debtisnotme

hazyjo wrote: »

Wouldn't make any difference to me - still wouldn't buy LH. Mainly because of onward sales - I wouldn't be able to explain all that to buyers, so I'd be limiting my market. I also just wouldn't want a LH house!


Appreciate it's common in some areas - that would be a different matter as future buyers wouldn't run a mile and would be more familiar with it.

Its common in my area (one side of the street tends to be leasehold and the other freehold) but I would never consider it either, I don't know why anyone with a choice would.

kinger101

The £7 per year could become [STRIKE]really[/STRIKE] ever so slightly expensive if we go though a prolonged period of hyperdeflation.

Tink_x

Robyn - did you go through with your purchase?
We too are buying a leasehold - 965 years left, £10 per year ground rent.
We too have similar concerns!
Solicitor is currently finding out more info. The thing is most worried about is an increase in the groundrent - im hoping there is a clause or something in the lease that stops any increases.
All these new build horror stories have scared me!

troffasky

Tink_x wrote: »

We too are buying a leasehold - 965 years left, £10 per year ground rent.
We too have similar concerns!
Solicitor is currently finding out more info. The thing is most worried about is an increase in the groundrent - im hoping there is a clause or something in the lease that stops any increases.
All these new build horror stories have scared me!

With 965 years left I'm going to take a stab in the dark and say that it's unlikely to be a new build.
The lease will say what the freeholder can charge you. Stab in the dark #2, if the lease allowed the freeholder to increase the ground rent, it wouldn't still be £10, would it?

After two years you have the right to buy the lease [enfranchisement]:
https://www.lease-advice.org/advice-guide/houses-qualification-valuation/
so you might be able to ask the current owner to do this before selling to you [I don't know the timescales here so may not be practical].

If the lease contains a clause about with whom the house must be insured, Commonhold and Leasehold Reform Act 2002 section 164 has you covered there.

prowla

Could the lease include terms about parking, fences, right of access, etc.?

troffasky

The lease terms could include pretty much anything. If in doubt, ask your conveyancer.

Bear in mind that "estate charges" can apply to freehold properties as well.

macman

The majority of houses in central London are leasehold. That doesn't seem to deter the residents of Westminster or Kensington and Chelsea from shelling out millions to buy them...