Sale falling through - what shall we do with this complete turkey of a flat?

Davesnave

ginger_chocolate wrote: »

Neither of us really cares for the idea of being a landlord, but the idea of having to sell for half what he bought it for really sticks in his throat (which I totally understand).

Where is this idea coming from? How far below the price your OH paid in 2003 are you now in percentage terms?

It'd be a rare property that would only sell at 50% of the 2003 price. Not impossible in some locations, but is a drastic cut like that really necessary?

ProDave

How much id the flat "worth" and what would it rent for each month?

I don't understand the issue with a mortgage. Here in Scotland leasehold is rare. We used to own a flat freehold. It was organised so we shared the freehold 50:50 with the flat above. We were individually liable to repair and maintain our own bits, and jointly responsible to repair and maintain common parts, specifically the foundations and the roof. There was no management company, no ongoing maintenance to pay for and no problem getting a mortgage.

ginger_chocolate

don't understand the issue with a mortgage. Here in Scotland leasehold is rare. We used to own a flat freehold. It was organised so we shared the freehold 50:50 with the flat above. We were individually liable to repair and maintain our own bits, and jointly responsible to repair and maintain common parts, specifically the foundations and the roof. There was no management company, no ongoing maintenance to pay for and no problem getting a mortgage.

We don't own the freehold. An uncommunicative ground landlord in another city does. We did want to try and buy the freehold but we need 50% of the other leaseholders on board to do so, which isn't possible at this time (if ever). The problem is, that if the leaseholders don't take on their share of maintenance responsibilities there is no realustic legal comeback. We spent years exploring this before putting the flat on the market.

Just for info - the flat was bought in 2003 for £10000. The offer we accepted was for £94000 (a typical flat in this area would go for £130000). It's difficult to tell what it will actually sell for. I may be being a bit melodramatic with the 'half the price' comment to be fair....

ProDave

And what would it rent for?

cloo

I think I might get rid at auction before any really big costs come and bite you on the *rse!

Bluebell1000

We had a slightly similar situation with my husbands flat, though he owned a share of the freehold there was no management company or anything. It didn't appear to affect mortgagability, it just had a couple of sales fall through. We decided to rent it out, and did so for several years. We had problem tenants - the first never paid, trashing the place, the second ones paid for a couple of years and then disappeared - it was at the lower end of the market and although it did make a small profit, it was never really worth the hassle.

We had another go at selling and managed to get back roughly what he'd paid in the end. So in some ways it was worth waiting because the value had risen a bit in that time, but I'm not sure it entirely made up for the stress of the difficult tenants....

bouicca21

I take it that there is a nought missing in the 2003 figure. In which case selling at a loss at circa £85-90k is not too bad. As others have said put it up for cash buyers only. Think of it like a rental - the potential loss and the cost of renting it since 2003 offset each other.

ginger_chocolate

And what would it rent for?

Another flat in the same block rents out for just over £500 a month

hazyjo

How many years left on the lease? If say a 999 ish lease, no worries. But if it was a 99 or so, that will also start to become yet another issue with it!

Mnd

Perhaps this is the property that Crashy Time is waiting for!