Worried Parent

caylus

My daughter who's in her mid twenties has been looking for some time to buy her first home in the north of England. We've viewed many properties together and missed out on a few due to higher offers (some going above asking).

She's just had an offer accepted of £220000 on a smart little semi in a decent area which she likes though not as much as some she was previously keen on.

What's causing the worry is that it's leasehold with a ground rent of approx £240 per year plus management costs currently about £140 per year (house about 10 years old so newish estate).

I appreciate there's new legislation on the way regarding leasehold properties but can't help feeling she should continue looking and find a freehold property without those on going charges. The price agreed doesn't really seem to show any discount against similar freehold properties.

Just wondered what people's thoughts are and that as a parent I'm worrying unnecessarily. Just hoping it won't be a decision she may regret in the future when it's time sell

jackieblack

Personally, I would carry on looking

Albermarle

How long is the lease?

Ideally freehold is better but £400 a year is relatively small amount, compared to other house costs. The conveyancing alone will probably cost over £2000.

 Just hoping it won't be a decision she may regret in the future when it's time sell

That pretty much applies to anyone buying a property, freehold or leasehold.

Neil49

Just to add that many modern estates with freehold properties have a management fee to cover ongoing maintenance. The leasehold issue is a nuisance but you may find quite a few newish builds are like that.

Also be aware that the new legislation regarding a maximum charge hasn't gone through yet. It probably will but watch out for any exclusions.

caylus

Appreciate the replies. The lease is a long one, 900 years plus so there's no issues with length. The other possibility would be to look into buying the freehold at some point. Recognise this would only be guesstimate at this stage but any thoughts on cost of purchasing the freehold given the figures mentioned? Anyone purchased a similar freehold and how straightforward was the process. Thanks again

user1977

The ground rent ought to be taken account of in the price.

Bear in mind that buying the freehold isn't going to remove the common charges. And those are fairly ubiquitous in modern developments, so if it's a dealbreaker for her than she may be restricting the scope of properties to consider.

jaybeetoo

If it were my son or daughter, I’d be concerned too. I can’t help feeling that landlords will use maintenance charges to recoup some of the money they will lose on ground rent. The whole system stinks. We need to get back to the old system where the local council adopts the local roads and footpaths so there is no need for ongoing maintenance charges.

Bigphil1474

Based on the recent announcement, ground rent will be capped and eventually phased out or be so small as to be irrelevant. She could look into what the maintenance fees are for. They are quite low, so maybe they are just for the green areas and a play area for example. Having that facility might be worth more to her than the amount they pay. Does it go up every so often, is it due to go up, how much by etc. are all questions the solicitor should ask. I would always prefer freehold, but it's not to say that this is a bad purchase. After all, someone has lived there for 10 years give or take. Maybe go have a chat to the neighbours.

silvercar

a 900 year lease with a small management charge wouldn’t bother me.