When to make an offer on a leasehold house with absent landlord

runningBadger

Hi

I am currently looking for a house to buy. I've found one that I'd like to put an offer in on, but there are complications. The house is leasehold, and the seller's estate agent told me that the lease hadn't been paid in 20 years as the landlord is believed to be deceased. She also said that the yearly charge was minimal (i.e. around £5) - this is to be confirmed though. I've read a bit about absent landlords, and I'm aware that it can cause problems later on, especially if you plan to extend the house (which I do). The seller has moved into a care home, and the sale is being managed by a family member. I would like to put an offer in on this house, but I am reluctant to do so until I know the full details around the leasehold. I have asked for more information, but I'm not getting a quick response from the seller.

On the one hand I don't want to put an offer in until there is clarity around the leasehold, and on the other hand I want to put an offer in / get it accepted (hopefully) so that the house is taken off the market. It's been on the market for around 6 weeks. Does anyone have any advice, or am I better of sitting back and waiting?
Thanks in advance!

AnotherJoe

Putting an offer in doesn't commit you so you could make one now and vary it later if there were some issues to do with ground rent not being paid (rather than "not paying the lease")
It will also encourage the owner to get on and fix up the unpaid ground rent issue.

davidmcn

Well, nothing's binding until after the point when you know what the lease actually says, and to some extent any risks of an absent/unknown landlord can be insured against, so there's not necessarily a reason to hold off from making an offer.

runningBadger

Thanks for your thoughts AnotherJoe. Yup - you are quite right - ground rent not being paid. I will make more of an effort to get my words right next time!

runningBadger

Thanks davidmcn

ethank

I bought a flat with an absent landlord. It means that you are going to be responsible for your own buildings insurance and maintenance. You will need indemnity insurance.

You might find it difficult to extend the property without getting permission of the leaseholder as you will be in breach of the lease.

Would ask your lawyer to give you proper advice on this one. There is also great advice from https://www.lease-advice.org/advice-guides/

PasturesNew

There is unlikely to be clarity around the leasehold.

If there's an absent landlord, who is probably deceased, then that is something you can pursue as a leisure activity after you've bought it, but it's not easy. For £5/year it's in nobody's interest so far to bother.

In short: To find the owner of the leasehold you'd have to dig through all the paperwork/deeds and find his name. If you're lucky it'll be somebody with an identifiable name who didn't move about much. It might've been, say, a chap who owned the house next door who built this one and sold it 50-60 years ago.

So, there he is, in his house, reaping the rewards of his £5/year. Then he gets old... and sells his house next door (or next door could've sold the plot to a builder). Then he dies.

So, you need to identify that person, find his death, get his death certificate to find out when/where he died and who signed the certificate. Is that family? Is it a Doctor? Who is this person? Then you look for probate records - did he have an estate? Get a copy of his Will if one existed. You're looking for clues about family/who inherited anything.

Now hope to find other evidence of his life. The objective here is to find his birth certificate. From his birth certificate you hope his parents were married and had other children. You hope they all have distinctive names and didn't move about much

You then build a family tree and fill it out.

It's possible it was overlooked when he died and family are easy to find and establish who inherited the freehold.

It's equally possible he was a builder who bought that bit of land, built that house, it broke him, he ended up dying alone in a bedsit - an illegitimate son of an only child - and it starts to get more complex.

runningBadger

Thanks ethank - looks like a good resource. Plenty of reading to get through there!

runningBadger

Thanks PasturesNew - I see what you're getting at

davidmcn

PasturesNew wrote: »

It's possible it was overlooked when he died and family are easy to find and establish who inherited the freehold.

Though if you've pursued the easier option of just insuring against the risk of the freeholder turning up, it will be a condition of the policy that you don't rock the boat by trying to contact someone who might be the freeholder.

runningBadger

Thanks davidmcn

Would insuring against the risk of the freeholder turning up also allow me to do an extension without risk? Or is that just to cover off the scenario of the freeholder turning up and asking for X years of ground rent?