Buying freehold

Thriftmaster1973
Thriftmaster1973 Posts: 130
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edited 18 March 2021 at 3:55PM in Mortgage-free wannabe
I have just received my annual ground rent letter - it's £17 per year.
Every year I get the offer to buy the freehold - usually £1400 + legal costs, however this year they have offered it for £700 + legal costs £500.

Some people I have asked say it's a big bonus to buy the freehold whilst others have said it's not worth it.

I have the funds available to make the purchase, it will make the MFW journey a couple of months longer, what I want to ask is should I do this?
£52,365 owing December 2017.Now for the final countdown..1st Jan 2021 - £29,316 -- 1st Feb 2021 - £28,809 -- 1st Mar 2021 - £27,309 -- 1st Apr 2021 - £26,811 -- 1st May 2021 - £26,315 -- 1st Jun 2021 - £25,811 -- 1st Jul 2021 - £24,311 -- 1st Aug 2021 - £23,809 -- 1st Sep 2021 - £22,305 -- 1st Oct 2021 - £21,798 -- 1st Nov 2021 - £20,292 -- 1st Dec 2021 - £19,783 -- 1st Jan 2022 - £18,276 -- 1st Feb 2022 - £17,762 -- 1st Mar 2022 -£17,248 -- 1st Apr 2022 -£15,713 -- 1st May 2022 - £15,202 --1st Jun 2022 - £13,703 -- 1st Jul 2022 - £13,184 -- 1st Aug 2022 - £11,665 -- 1st Sep 2022 - £11,144 -- 1st Oct 2022 - £9,822 -- 1st Nov 2022 - £9,298 -- 1st Dec 2022 - £7,572 --1st Jan 2023 - £7,045 -- 1st Feb 2023 - £5,516 -- 10th Feb 2023 - £5,518 Overpayment Pot @ 10th Feb 23 = £5,518 / Primed = £0 / Actual debt = £0!!!! "Yes, the medicine is harsh, but the patient requires it in order to live, should we withhold the medicine?" Hopefully at zero mortgage debt by December 2022 or very close to it. Determined for freedom! 🍻🥂🍸🍹.

Comments

  • South_coast
    South_coast Posts: 4,781
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    Personally, I would snap it up at that price. It might not make much difference to you, but could really help any future re-sale. A lot of people can be sniffy about leasehold, so you'd be opening yourself up to a much wider market
    Mortgage start: £65,495 (March 2016)
    Cleared 🧚‍♀️🧚‍♀️🧚‍♀️!!! In 5 years, 1 month and 29 days
    Total amount repaid: £72,307.03. £1.10 repaid for every £1.00 borrowed

    Finally earning interest instead of paying it!!!
  • eddddy
    eddddy Posts: 16,109
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    edited 18 March 2021 at 8:46PM

    With that kind of ground rent, I'm guessing you have the balance of a 999 year lease.

    One benefit is that you should no longer be bound by leasehold covenants. For example, your lease might require you to get consent for alterations.

    And maybe it makes the property slightly more saleable.

    You should also instruct your own solicitor, which will add to the costs.
  • Coffeekup
    Coffeekup Posts: 661
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    I agree with the above. but me being me, over thinking things I would get a I probably would get a surveyor round first to "know what they know".
  • Hello and thanks for your advice, I have decided to proceed with the freehold purchase as the offer @ £700 plus fees seems quite cheap (compared to previous years of around £1400 plus fees).
    It will mean no overpayments for a couple of months but the bonus is that I won't have to consult for any alterations (leaseholder requires this as I've read it in the small print).

    I shall just look at this as further progress and an enhancement to being mortgage free.

    BTW - yes it is a 999 year lease - minus 40 years.
    £52,365 owing December 2017.Now for the final countdown..1st Jan 2021 - £29,316 -- 1st Feb 2021 - £28,809 -- 1st Mar 2021 - £27,309 -- 1st Apr 2021 - £26,811 -- 1st May 2021 - £26,315 -- 1st Jun 2021 - £25,811 -- 1st Jul 2021 - £24,311 -- 1st Aug 2021 - £23,809 -- 1st Sep 2021 - £22,305 -- 1st Oct 2021 - £21,798 -- 1st Nov 2021 - £20,292 -- 1st Dec 2021 - £19,783 -- 1st Jan 2022 - £18,276 -- 1st Feb 2022 - £17,762 -- 1st Mar 2022 -£17,248 -- 1st Apr 2022 -£15,713 -- 1st May 2022 - £15,202 --1st Jun 2022 - £13,703 -- 1st Jul 2022 - £13,184 -- 1st Aug 2022 - £11,665 -- 1st Sep 2022 - £11,144 -- 1st Oct 2022 - £9,822 -- 1st Nov 2022 - £9,298 -- 1st Dec 2022 - £7,572 --1st Jan 2023 - £7,045 -- 1st Feb 2023 - £5,516 -- 10th Feb 2023 - £5,518 Overpayment Pot @ 10th Feb 23 = £5,518 / Primed = £0 / Actual debt = £0!!!! "Yes, the medicine is harsh, but the patient requires it in order to live, should we withhold the medicine?" Hopefully at zero mortgage debt by December 2022 or very close to it. Determined for freedom! 🍻🥂🍸🍹.
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