Should I buy or not buy?

lknights1987 · 2 June 2019 at 11:22PM

I'm currently renting a 2-bed apartment in Ipswich which is within 1 mile from the train station and 1 mile from the town centre ( paying £600 per month rent).

The landlord has put the apartment up for sale and I've been told by the estate agent that the landlord is looking to sell to another landlord looking to rent out the apartment so that we can stay here unless myself and my partner wants to buy it ourselves.

He has advertised the property at £125k which I can afford to buy. There has been no viewing since it was listed on Rightmove over a month ago.

The apartment is on the second floor out of 3 floors and has loft access within the apartment whereas the other apartments don't have loft access within there apartments and also the apartment has good size bedrooms, a good size living room and a kitchen with white goods integrated. Currently, there are 87 years left on the lease. The property was built in 2006 so quite new.

We have submitted a few offers starting at £105k which was rejected. Our latest offer is £115k which I personally think is a good offer however that was rejected as well.

We have been given a hint that we are close to what the seller wants so I'm assuming its about £118k however there are currently 87 years left on the lease and the service and ground rent charges total £1200 a year meaning having a mortgage plus the service and ground rent charges will cost around £550 per month.

The plan is to buy somewhere which me and my partner can afford and stay there for 2-3 years which should give us enough time to have some equity for a deposit to buy a house.

Is it worth going for it and buy the apartment at £118k or not? I'm worried that after 2-3 years having 84 years left on the lease will turn potential buyers away. Am I right in saying that when a lease drops below 80 years the valuation of the property drops as well?

I'm also thinking with the property being close to the town centre and train station with direct links to London, Norwich and Cambridge the property prices could rise in the next 2 years. For the same type of property in nearby towns ie Colchester the prices are 15-20k higher.

Paul_Don · 2 June 2019 at 11:38PM

Seems a good bet but for the length of lease, dip below 80 years and it causes issues, I would only buy if landlord extends or factors in the price of extending the lease in the sale price.

markin · 3 June 2019 at 3:54AM

Sounds over priced for the lease and service charge, i don't think they will budge on the price for a year as long as they are getting income from it.