Ground Rent Raising To £4,000???

HampshireH

strawberries1 wrote: »

UPDATE!!

There's an identical property in perfect condition new windows, refurbished bathroom & kitchen, new boiler, freshly painted etc DIY job done by current owner but seems like it's been done well. It's on for £11k more than the one I'm purchasing.

We're about to exchange but I feel I shouldn't continue with this transaction. The doubling ground rent leaves me uneasy. This other one at £30pa with 99yrs left in comparison with £250gr x 2 every 25yrs with 122yrs left the £30 GR seems better but then it's tenanted, notice expiring early Feb (single mum with 2 kids waiting for council property) I wonder whether to pull out of this transaction and go for the £30GR instead but who know if it will go through to completion even if my offer is accepted? The current transaction as taken 8months, indeed 9 to get to exchange and completion.

I plan on living there for 5yrs at least.

So you need to weight up;

* short lease
* cheaper ground rent
* potential (probable) delays due to tenant in situ
* starting the whole process from scratch

v's

* longer lease (easier to resell later down the line & less likely to need to buy an extension
* Expensive ground rent
* no tenant, potentially no delay
* likelihood of moving within the next few months

Guess it comes down to what you can afford to lose financially based on what you have paid out already compared to what you may have to pay in the future.

No-one can answer that for you.

csgohan4

walk away, ground rent is now is false economy, when you come to sell who will want that kind of ground rent, stupid...

chappers

I'm surprised your still in this deal you had so many concerns at the outset.
Lease aside, your concerns about the conduct of the freeholder would be enough to worry me

strawberries1

chappers wrote: »

I'm surprised your still in this deal you had so many concerns at the outset.
Lease aside, your concerns about the conduct of the freeholder would be enough to worry me

I've not had any dealings with the freeholder.

chappers

strawberries1 wrote: »

I've not had any dealings with the freeholder.

It was just that in the initial post you said that research had thrown up some issues with the freeholder.

strawberries1

chappers wrote: »

It was just that in the initial post you said that research had thrown up some issues with the freeholder.

Yes. They're predatory in my opinion.

strawberries1

HampshireH wrote: »

So you need to weight up;

* short lease
* cheaper ground rent
* potential (probable) delays due to tenant in situ
* starting the whole process from scratch

v's

* longer lease (easier to resell later down the line & less likely to need to buy an extension
* Expensive ground rent
* no tenant, potentially no delay
* likelihood of moving within the next few months

Guess it comes down to what you can afford to lose financially based on what you have paid out already compared to what you may have to pay in the future.

No-one can answer that for you.

Absolutely right HampshireH!!

strawberries1

So, the seller says the tenant can move to her mum's after her tenancy ends and is willing to accept my offer if it is a firm offer.

My main issue is the tenancy.

He's put forward two options; buy for £270k 75yr remaining and GR at £30 or with lease extended (by negotiation) £300k 125yrs GR @ £150.

I wonder how much it will cost to extend statutorily. ie at a value of £270k with 75yrs remaining.

AdrianC

https://www.lease-advice.org/calculator/

Taking £300k value with long lease, and £30 current ground rent expiring in 2091, then about £15k plus legals, to give you 99 more years at peppercorn ground rent.

strawberries1

Thank you! I've just used that link and confirmed your estimated figure.
Do you have any idea how much legals and other fees might amount to?