lease question

3mph

If bought at same time as lease does it incur Stamp duty?
Or can you buy it separately but same time and avoid Stamp duty on it?
I don't know but I am sure someone here will.

G_M

It would be a 'linked transaction' so you'd pay SDLT on the combined cost.

Hoploz

Buy the freehold at the point of purchase, or find a different house would be my advice. It would be worth checking also, whether there will still be restrictions imposed if you do buy the freehold. I'm thinking you'll have to be an extremely good negotiator to get it thrown in for free.

kieron79

OK thanks, could this get added to the mortgage or would it be an actual 'cash' purchase?

da_rule

If you're also buying the freehold at the same time, then your solicitor should get the Land Registry to merge the freehold and leasehold titles into one freehold title. The mortgage will therefore be secured over this.

If you cannot secure the freehold, then you need to make sure that the mortgage company and their valuer knows this. It probably won't make any difference given the length of the lease, but still worth bringing it to their attention early.

kieron79

thanks for advice everyone

Richard_Webster

OP has not mentioned how much the ground rent is. This makes a serious difference to the value of the freehold.

If it is nominal, like £5 per annum, then the freehold is perhaps worth £100. If, as much more likely, it is say£259 per year then on 20 years purchase you are looking at £5,000. If the ground rent increases every 25 years in line with the RPI then much more. if it is ridiculous and doubles every 10 years then definitely don't buy it leasehold and buy it freehold from day 1.

(or don't buy it at all because it is probably overpriced anyway....)