Buying a shared leasehold: CONFUSED

macmonkeyuk

Hi Guys

I'm looking for some pros and cons on buying my share of a leasehold from the property developers who converted an old school into 9 residential dwellings - one of which I own (mortgaged).

As a group, all of the residents have been given the opportunity to buy the leasehold for the whole of the plot that the conversion stands within. The more that opt to buy, the cheaper the cost per resident would be. As I understand, the property would not become freehold, it would remain leasehold, but we would own the lease and therefore have more control over what happens. I don't know whether owning the leasehold would have a positive effect on my house value. Anyone?

We've been given first refusal and although I'm not entirely clear on all of the ramifications, I'm not too thrilled by the idea of the developer selling to a third party if we, as a group, choose not to take them up on the offer. The price we haven't been quoted seems reasonable.

Here are the what I think are the important details:

- It's not flats, i.e. the dwellings aren't one above another
- We have individual garden plots and some communal access including a private car park
- The lease has 249 of 250 years to run
- All residents currently pay annual ground rent and service charge to the developers that covers communal maintenance and buildings insurance

Any pointers or watch-outs?

Thanks in advance,
Paul

kingstreet

Presumably, you already own a leasehold property in the development and you and the other leaseholders are considering purchasing the freehold for the building?

G_M

If you're thinking of buying, read up and learn what you are buying!

macmonkeyuk wrote: »

I'm looking for some pros and cons on buying my share of a [STRIKE]leasehold [/STRIKE]freehold? from the property developers who converted an old school into 9 residential dwellings - one of which I own (mortgaged).

As a group, all of the residents have been given the opportunity to buy the[STRIKE] leasehold [/STRIKE]freehold? for the whole of the plot that the conversion stands within. The more that opt to buy, the cheaper the cost per resident would be. As I understand, the property would not become freehold,correct it would remain leasehold, but we would each continue to own [STRIKE]the[/STRIKE]one lease lease as well as all jointly owning the freehold and therefore have more control over what happens. I don't know whether owning the [STRIKE]leasehold[/STRIKE]freehold would have a positive effect on my house value. Anyone?
The value of your lease would be unchanged. But you'd also own a share of the freehold which also has a value.

We've been given first refusal as per the law, and although I'm not entirely clear on all of the ramifications, I'm not too thrilled by the idea of the developer selling to a third party if we, as a group, choose not to take them up on the offer. If you don't all buy (or a subset of you) you'd have no choice. The freeholder can then sell to someone who does want it. The price we haven't been quoted seems reasonable.

Here are the what I think are the important details:

- It's not flats, i.e. the dwellings aren't one above another so?
- We have individual garden plots and some communal access including a private car park
- The lease has 249 of 250 years to run
- All residents currently pay annual ground rent and service charge to the developers that covers communal maintenance and buildings insurance

Each leaseholder would still have to pay the ground rent and service charges. But as a group, you would receive that money and choose what to do with it.

Lots more info here:

http://www.lease-advice.org/article/owning-share-freehold-flat/

http://www.lease-advice.org/advice/fact-sheets/right-of-first-refusal-fact-sheet/