Is there any reason to buy the freehold?

united4ever

Got a semi detatched house with a £12 per year ground rent and about 950 years to run. They wrote to me asking if I wanted to buy the freehold for just over 1k. There is no good reason to is there?


If I wanted to extend...most of my neighbours have done as much as I may ever do and I believe they are also leasehold.


If I was to sell, surely the buyers would see £12 a year and not be put off (or they could just buy the freehold themselves).


Is there anything I am missing here?....if not I shall carry on paying £12 a year.

jimbog

They may sell it to a third party company instead.
It will make it more attractive to buyers as a freehold property

united4ever

jimbog wrote: »

They may sell it to a third party company instead.
It will make it more attractive to buyers as a freehold property

sure they may sell it on but don't think they can increase it.


hmmm, yeah, I take your point about attractive to buyers.

jimbog

They might not be able to increase it but might they ask exorbitant fees for giving permission to do even minor jobs?

united4ever

I see, is negotiation common when buying a freehold? Could I counter offer their offer?

robatwork

Probably the best £1000 you'll ever spend.

I wouldn't even look at a leasehold semi-detached house.

jimbog

Reading these might help you make up you mind.

I remember another thread a couple of years ago when a new freeholder wrote to all the householders saying that they had breached covenants and their leases and were wanting 1000's on compensation.
https://forums.moneysavingexpert.com/discussion/5930115/ladybrook-securities-stopping-house-from-selling&highlight=leasehold+breach
https://forums.moneysavingexpert.com/discussion/5700824/buying-leasehold-house-freeholder-retrospective-and-future-consent&highlight=leasehold+breach
https://forums.moneysavingexpert.com/discussion/738631/anyone-had-dealings-with-ladybrook-securities-ashby-breweries-claiming-ground-rent&highlight=letter+from+leaseholder
https://forums.moneysavingexpert.com/discussion/735465/compton-group-ground-rent-insurance&highlight=letter+from+leaseholder

Mossfarr

I was in a similar situation with one of my ex-local authority properties except my ground rent was 'two peppercorns' so actually nothing to pay.
I bought mine so that I did not need to ask permission to extend, add a porch or conservatory etc, as each time permission is sought there is a fee to pay. it is also in preparation for when I sell, much easier to sell a freehold house as there are so many horror stories about leasehold property's at the moment.

The thought that it could be sold on to one of those awful companies was a good enough reason to buy it in my view! Mine cost £1548 in total including legal fees - well worth it.

chunkytfg

As has been mentioned think about the costs of selling it too. Solicitors will charge more for LH vs FH properties.

Speak to an EA and ask what kind of price difference it'll make.

Plus as someone who has recently gone through the process of looking at houses to buy we didn't even entertain the idea of a couple very nice looking houses purely due to the fact they were LH!

Slithery

It's a no-brainer. You'll make at least that much back again when you sell either through an increased price or a quicker sale.

Instability

I've been looking for houses recently; I simply discounted leaseholds. I am aware there are plenty like yours where they don't cause real issues, but it's far easier for me to just look at freeholds rather than try to figure out whether a specific leasehold is a reasonable one or a disaster in waiting.

Imagine I can't be the only one who does this when looking, and I imagine many down value houses with leaseholds by more than £1k when looking to buy; so for ~£1k I'd think it'd be a good investment if you were planning on selling at some point.