Cold feet or too much change?

Karr55

Long story short - I sold my house in 2020 to move for a job, couldn’t find anywhere to buy and the job didn’t work out. I lived in a series of rented rooms because property prices were so high in 2021. Offered on a house and pulled out after the survey showed major work of about £25k was needed, so lost over £1k. 

I then bought a small “flipped” house in a remote area, hated it and sold it within the year. After a complicated probate I now have slightly more cash for a larger house but the one I’ve offered on has a lease increasing every 30 years and I have cold feet about investing most of my cash into a house I might not be able to resell having already invested £2k in surveys, searches and conveyancing fees, plus guilt about not wanting to let the seller down. 

I have spent thousands in searches, surveys and solicitor’s fees and am currently temporarily living in a spare room. This would be my 5th house in 22 years + rented rooms and it’s all been so much change. I regret moving in 2020 but there’s no point in looking back. 

In short, I’ve lost confidence in my gut instinct/decision-making abilities and don’t want to feel trapped as I did in my last house. Renting would just reduce my capital. 

Please don’t reply if you can’t be kind, I’m aware I’m in a fortunate position as a cash buyer and a poster on a previous thread told me to find something more serious to worry about. I’m just exhausted by it all. 

theoretica

How much is the lease increasing by, what does your solicitor say about that?  Any chance of buying out the lease?

Dustyevsky

You have discovered some of the things you don't like, such as remoteness, which will help you to narrow the field a little when you are next ready to buy. I say 'next' because it doesn't sound like you're ready yet.

Don't worry about letting the seller down; we lost 3 buyers in the last recession and it took us ages to sell, but we survived! As you've discovered, buying the wrong house will cost you more than guilty feelings.It's a business transaction with no guarantees until contracts are exchanged.

People on here seem to recommend lists. Start with 'must-haves,' list those, and then move to 'important but not totally essential 'nice to have's' The rest are bonuses that might swing it for one property rather than another. Similarly, rank parts of your local area, remembering a 'don't want to live here' is a "No," even if the house is shouting "Yes!" 

Don't be in a rush. Whatever the news outlets say, we're in a recession, so if your job is pretty secure, that puts you in a good position. If it isn't, maybe waiting is not such a bad thing. Either way, as you filter properties using your lists, you should re-build your confidence and eventually know when you've found the right thing. Just don't expect it to be perfect; they never are!

Karr55

theoretica said:

How much is the lease increasing by, what does your solicitor say about that?  Any chance of buying out the lease?

The lease increases by £50 every 30 years and will be £150 in 4 years, so it is a long time before it will be over £250 (it’s outside London) - my solicitor has advised that this could reduce resale possibilities because some lenders won’t lend on such leases even when the ground rent is only £150 per year. There could be leasehold reform, but no one can count on it. 

ArbitraryRandom

Hmm... 

IF you live there 4 years (noting you previously sold a property quickly because you didn't like it) - COULD you see yourself living there 'forever'?

If so, resale value doesn't really matter - and you could always look into purchasing the freehold in the future. 

Not to diminish your feelings by word choice, but if that 'commitment' is your only concern then I'd ask why you want to buy a house rather than stay renting long term? 

Seriously - what is the value of owning a property to you and does this house tick those boxes? 

Because to me (as someone who doesn't know you and only has one post to go on), it sounds like you really need roots for a while and even if you do sell a few years down the line I doubt an extra £50 on the lease will compare unfavourably to what you would have paid in rent over the same period... 

Karr55

ArbitraryRandom said:

Hmm... 

IF you live there 4 years (noting you previously sold a property quickly because you didn't like it) - COULD you see yourself living there 'forever'?

If so, resale value doesn't really matter - and you could always look into purchasing the freehold in the future. 

Not to diminish your feelings by word choice, but if that 'commitment' is your only concern then I'd ask why you want to buy a house rather than stay renting long term? 

Seriously - what is the value of owning a property to you and does this house tick those boxes? 

Because to me (as someone who doesn't know you and only has one post to go on), it sounds like you really need roots for a while and even if you do sell a few years down the line I doubt an extra £50 on the lease will compare unfavourably to what you would have paid in rent over the same period... 

Thank you. Yes, I really do need roots for a while and the lease situation doesn’t seem to have affected house prices there. I’m not sure how purchasing freehold works - can the freeholder just say no? 

ArbitraryRandom

Karr55 said:

ArbitraryRandom said:

Hmm... 

IF you live there 4 years (noting you previously sold a property quickly because you didn't like it) - COULD you see yourself living there 'forever'?

If so, resale value doesn't really matter - and you could always look into purchasing the freehold in the future. 

Not to diminish your feelings by word choice, but if that 'commitment' is your only concern then I'd ask why you want to buy a house rather than stay renting long term? 

Seriously - what is the value of owning a property to you and does this house tick those boxes? 

Because to me (as someone who doesn't know you and only has one post to go on), it sounds like you really need roots for a while and even if you do sell a few years down the line I doubt an extra £50 on the lease will compare unfavourably to what you would have paid in rent over the same period... 

Thank you. Yes, I really do need roots for a while and the lease situation doesn’t seem to have affected house prices there. I’m not sure how purchasing freehold works - can the freeholder just say no? 

I can point you to some background reading, but if this is something you want to consider you really should talk to your solicitor. 

First option is the informal route (you could ask your solicitor now to contact the freeholder and ask if they would be willing to sell it to you and you just negotiate from there. This might save cash re solicitors fees and survey). They can say no or set an unreasonably high price. 

OR there's the formal route (you have to have lived there for a minimum of 2 years - so you could settle in for a bit and buy it when/if you're ready). Which is if you can't reach an agreement with the freeholder then a tribunal can set a purchase price. This is likely to cost a few thousand inc valuation and solicitor fees as it's unlikely you can use the survey from your purchase. 

Some more info here:

https://hoa.org.uk/advice/guides-for-homeowners/for-owners/step-step-guide-buying-freehold/
 https://www.gov.uk/leasehold-property/buying-the-freehold
https://forums.moneysavingexpert.com/discussion/6038626/buying-a-freehold/p1

mi-key

The other way to look at it is 

1) You want to buy the house. Chances are if you decided to sell in the future, then someone else would want to as well. I assume other houses in the area have the same leases on them, and all of those have been bought by people in the past.

2) The ground rent amount is really negligable. Some lenders may not lend on it, but I'm sure there are plenty who will, so selling in the future wouldn't particularly be a problem.

3) Given that the ground rent the freeholder is getting is so small, then if they were willing to sell it's probably not going to be that expensive.

In reality, any house can be difficult to sell for all sorts of reasons, or they can be really easy to sell. You never know until you put it on the market. And, as your seller has found out, you only need one person who wants to buy it and doesn't mind the lease situation.