Should I buy a leasehold house?

Brexit_Fan

Davesnave wrote: »

So you would pass up a good house, where you could buy the freehold for a modest sum?

OK, fair enough, but I'd find it very hard to understand that!

I can only speak of people I know who have looked at buying a leasehold house. My partner recently looked at buying a brand new home (I have since convinced her not to do it) - the brand new homes were being sold as leasehold, and could potentially cost a small fortune in years to come.

da_rule

Also, it's worth double checking that the property is definitely leasehold and not freehold with a rentcharge.

Davesnave

Brexit_Fan wrote: »

I can only speak of people I know who have looked at buying a leasehold house. My partner recently looked at buying a brand new home (I have since convinced her not to do it) - the brand new homes were being sold as leasehold, and could potentially cost a small fortune in years to come.

So you are really talking about a specific type of leasehold property: those with severely escalating ground rents. They have only been around for a decade or two.

That leaves all the other types of leasehold house, such as my old one, where the ground rent was set in 1898 and didn't increase, so it was not even being collected by the mid-1970s.

scriv

There is another issue going on at the moment in the world of existing leaseholds, not just new builds.

Since Ground Rent was discovered as a good source of revenue, there has been a trend for developers to sell on the freehold interest to large faceless companies often traceable to off shore accounts and investors in the Virgin islands etc. This is all well and good if the new freeholders and their linked management agents are decent and fair BUT there is a good proportion of them who claim extortionate and unreasonable demands and fees for permissions, consents and admin charges etc and use very dubious means to get lots of money from the leaseholder.

These are the sort of leasehold properties you would be wise to avoid if possible, but it is not always easy to see what the leasehold demands are until you are a way along the process. Good independant legal advice is advisable.