Buying Your Freehold in NI

EitherWalnut

HI folks,

I (like many other people in the country I presume) own a house that is leasehold. I currently pay ground rent of £30 a year. I have no intention of moving any time soon, and the terms of my lease prevent me from doing pretty much anything to my garden without written permission from the developer who demands the ground rent. (I'm sure there are plenty of people that would just go ahead and do it anyway but I'm not what you's call a risk-taker!)

So it seems logical for me to try and buy the freehold for my property. Having done some reading, it actually seems like the process is pretty straightforward, but I'm worried that means I'm missing something! From what I can see on the DoF website it just seems to be fill in a load of forms and submit them with 9 x annual ground rent payment plus land registry fee and supporting docs.

Has anyone here ever bought their freehold? I'd be interested to know how much it cost you and how you went about it.

TIA!:hello:

saverbuyer

It's a simple process but just be aware, restrictive covenants still apply after you redeem the ground rent and own the freehold.

EitherWalnut

Thanks for the speedy reply!

I understand that restrictive covenants still apply - as they mention that clearly on the website, but I don't understand how that would apply in practice.

For example, at the moment, my lease stipulates that I cannot erect fencing or a shed without the express written permission of the leaseholder. If the developer is no longer the leaseholder, do I still have to ask their permission?

duggan1

nicmalauren wrote: »

If the developer is no longer the leaseholder, do I still have to ask their permission?

As I understand it the covenants are there to protect adjacent and surrounding properties to continue to have enjoyment of their property. Might include things like not putting a sky dish on the front of the property, or hanging washing out to dry.

Even if you hold the freehold these will still apply.

EitherWalnut

Ok, I understand that the covenants will still apply. I'll have to check my paperwork to see how vague (or not) they are. Presume if I replace fence with like-for like there can't be any complaints?!

Anyone got any experience with having restrictive covenants declared null and void?

(My house was a repossession and the garden is in need of some serious maintenance, but at first glance the terms of my leasehold seem quite prohibitive - which is why I started to explore buying the freehold in the first place, incase anyone is wondering!)

saverbuyer

Sadly there are only two ways to remove the covenant. Ask the party who benefits from the covenant to remove or go down the tribunal route. Both could prove costly.
It's unlikely the restrictive covenants are any more prohibitive that any other new build estate.

EitherWalnut

It's not a new build (must be about 30yrs old now), and no other properties overlook my garden so I'm struggling to see who would be offended/disadvantaged by me erecting a shed, for example.

If I take completely different tact and just write to developer and ask - if they say no, do you know if I have any grounds for appeal (or do they even have to explain their reasoning)?

Zola.

nicmalauren wrote: »

Ok, I understand that the covenants will still apply. I'll have to check my paperwork to see how vague (or not) they are. Presume if I replace fence with like-for like there can't be any complaints?!

Anyone got any experience with having restrictive covenants declared null and void?

(My house was a repossession and the garden is in need of some serious maintenance, but at first glance the terms of my leasehold seem quite prohibitive - which is why I started to explore buying the freehold in the first place, incase anyone is wondering!)

I would go ahead and do what you want within reason, its your house. Ground rent is just a BS tax. Worth finding out how much it would be to get rid of it.

Ours is only £14 a year, so doesnt bother me much, but if we stay long term I will get rid of it, probably.

I still went ahead and stuck a decent fence along the back of our garden.

Witless

Our ground rent is £5 for 6 months which can't increase for 900+ years: estate agent reckoned when we factored in the legal costs it wasn't worth it despite the extremely low buy out price £90?) the Land & property fees are £50 (+£190 for postal applications?) - no estimate of legal fees but possibly similar to a conveyance if there's a mortgage on the property.

The firm collecting the rent have already wanted to stop billing 6 monthly due to postage & banking costs and now want to do it yearly: I pay by cheque much to their disgust - they'd prefer 1 x £10 debit card transaction by phone or a direct debit/standing order to 2 x cheques by post. I told them I wouldn't be paying anything that wasn't billed in a timely manner.

There's nothing in the lease AFAIK about paying in person - they started cheques by post in preference to physical collections: if cheques end I cant see them starting collection again.

At our age (knocking on the state pension door) with the absolute minimum cost of buying it out equating to 25 or 30 years ground rent I'm happy enough to keep paying - eventually they'll do a 'bulk sale' footing the legal costs themselves - or we'll just keep paying.

(First £5 paid was equal to about 3 x packs cigarettes, now it's about 0.5 of a pack - what'll it be equal to in 10 or 15 years?)

(Not being unduly miserly - but this is an MSE discussion after all!)

Suplex_Backbreaker

Witless wrote: »

Our ground rent is £5 for 6 months which can't increase for 900+ years: estate agent reckoned when we factored in the legal costs it wasn't worth it despite the extremely low buy out price £90?) the Land & property fees are £50 (+£190 for postal applications?) - no estimate of legal fees but possibly similar to a conveyance if there's a mortgage on the property.

The firm collecting the rent have already wanted to stop billing 6 monthly due to postage & banking costs and now want to do it yearly: I pay by cheque much to their disgust - they'd prefer 1 x £10 debit card transaction by phone or a direct debit/standing order to 2 x cheques by post. I told them I wouldn't be paying anything that wasn't billed in a timely manner.

There's nothing in the lease AFAIK about paying in person - they started cheques by post in preference to physical collections: if cheques end I cant see them starting collection again.

At our age (knocking on the state pension door) with the absolute minimum cost of buying it out equating to 25 or 30 years ground rent I'm happy enough to keep paying - eventually they'll do a 'bulk sale' footing the legal costs themselves - or we'll just keep paying.

(First £5 paid was equal to about 3 x packs cigarettes, now it's about 0.5 of a pack - what'll it be equal to in 10 or 15 years?)

(Not being unduly miserly - but this is an MSE discussion after all!)

If it's only 90 quid to buy it out - just do it. Lots of people in England got caught out when the builders sold the freeholds on to third party companies who then go about extorting as much money as they possibly can.

No too sure if the law in NI prohibits this but laws and circumstances can change. Just spend the small amount it takes and own your property free and clear.

Witless

Suplex_Backbreaker wrote: »

If it's only 90 quid to buy it out - just do it.

Unfortunately it's not only £90 - that's just the ground rent price: there's Land & Property charges of £50 + £190 plus legal fees of £whatever ....

My estate agent's advice was to hang back until doing some other house transaction - main mortgage finishes in roughly 8 months (there's a small balance for another 6 months after that) at current (over)payment rate; totally clear early 2019 (or the month after a major rate rise!): we might well downsize at that stage or if there are legal fees at mortgage end (I don't know - are there?) I'd maybe consider it then.

Both solicitor (at purchase time) and estate agent (then and now) said the ground rent couldn't change for the remainder of the lease - it started as a 999 year one, there's over 900 years left.

Dunno: we'll see what happens.