Advanced search

leasehold advice

(23 Posts)
housesellingrant Fri 21-Apr-17 07:52:20

Hi, finally found a house we agree on, in budget, and still on market. However it is leasehold, and built by a company that was in press recently for selling leaseholds on and then increasing prices. Is there anyway to find out who owns leasehold and could we tie in buying a leasehold with buying the property?

whataboutbob Fri 21-Apr-17 08:29:21

Be very very careful. Be sure you do not use a solicitor recommended by the builders.
You could contact, a government funded organisation that advises people on lease issues.
I'd walk away if there was any possibility of steep increase in ground rents, lease being sold to professional freeholders etc.

whataboutbob Fri 21-Apr-17 08:30:31

Sorry that should be "freehold being sold to a professional freeholder".

glenthebattleostrich Fri 21-Apr-17 08:41:27

Have a look at the national leasehold campaign on Facebook, they also have a website.

Harumff Fri 21-Apr-17 08:44:49

We bought a bellway house a few years back (one of the companies in the press) and bought it leasehold - they wanted £7500 for the freehold and as the ground rent was only £100 a year for 125 years it didn't seem sensible at the time to buy. Within 3 years the rent was £127 a year (not a ridiculous hike but a hike nonetheless). The freehold had been sold onto a company called Homeground who have also been in the news. We considered using the freehold at that point but they wanted a couple of hundred pounds as an admin charge just to give us a quote. We were considering our options generally in any case and ended up putting the house on the market so left it leasehold (incidentally while the house was on the market we had a letter through saying a solicitor was acting for a number of people in the area to do a joint negotiation and had got prices down to £2k-£4K to buy the freehold so maybe it wouldn't have been too bad if we stayed).
Fast forward a few months and we've bought another new bellway home but this time bought it freehold - they were offering a better deal this time, £6.8k on a more expensive house with a higher rent so we just went for it for peace of mind.
Not sure if this was so easy because we bought it new but maybe you can buy the freehold at the same time as the house? We didn't have particular hassle with Homeground in the time we were there but I did worry about rent hikes in the future and the impact on saleability. Our old house sold the day it went on the market so no problems there, but there was still 122 years on the lease.... it's if you're planning on staying a while then selling that it's an issue when the lease is shorter.

Spickle Fri 21-Apr-17 10:19:36

This article appeared in The Guardian in October 2016:

housesellingrant Fri 21-Apr-17 13:09:12

Thanks spickle it was originally built by Taylor Wimpey, i think we are going to carry on looking, unless we can buy freehold or existing owners are prepared to purchase in advance of us buying.
Interestingly the estate agent told us we have to own property for two years before we could buy freehold. If that is legally the case how can professional leaseholders buy them?

ACatCalledFang Fri 21-Apr-17 14:06:43

I think they fiddle it, to be honest - I always understood the leaseholder should get first refusal if the freehold is being sold, but ours was transferred repeatedly between various companies and we were informed it had happened, rather than given any opportunity to buy it. Ours is a flat rather than a house. It's confirmed my view that residential leasehold is a racket - I'd never buy a leasehold property again if I had a choice.

MiladyThesaurus Fri 21-Apr-17 14:10:14

The first refusal thing only applies to flats. With houses they can sell it without saying anything to the leaseholder.

Moneybox Live did a programme about leasehold houses this week:

sunnysouthend Fri 21-Apr-17 14:22:30

Yes, leasehold houses personally I wouldn't touch with a barge pole because you have very little rights as the leaseholder, unlike leasehold flats. Look at the leasehold advisory service website for comprehensive info on leaseholds and rights you would have.

MiladyThesaurus Fri 21-Apr-17 14:25:03

The guy on moneybox live was very clear that buying a leasehold house is only buying a tenancy; it is not home ownership the way people imagine it is.

housesellingrant Fri 21-Apr-17 15:13:52

Thanks all, we are viewing a couple of others tomorrow instead

namechangedtoday15 Fri 21-Apr-17 15:41:43

To be clear there is a difference between what I'd class as "new build" leaseholds - so maybe those built in the last 20 odd years and those built in the pre or inter-war. We have a 30s semi with a 999 yr lease and the ground rent is fixed for the length of the lease at £4. So you do need to know what you're buying or considering, its not a case that all leasehold has the same issues.

housesellingrant Fri 21-Apr-17 15:55:29

Hi name change I'm surprised they just don't give you the freehold, it must cost more to collect than it makes.

namechangedtoday15 Fri 21-Apr-17 16:11:09

It depends where you are. We're in the NW and have owned 4 houses, all of which have been leasehold. Leasehold - particularly for 1930s and 1940s housing stock which is abundant here - is the norm. So whilst £4 is peanuts, they'll be collecting £4 from tens of thousands of properties which I suppose is probably worthwhile.

sunnysouthend Fri 21-Apr-17 18:18:34

I think older leaseholds were usually created for ex council houses so that the council could retain overall control of estates. Obviously even with a long tenure you are still tied into getting permission, and usually paying for that permission for any changes like extensions etc.

Namechangeinto2017 Fri 21-Apr-17 18:26:06

We also have a 1930s leasehold property in the NW we bought the freehold for £1500 after we moved in although like name change we had a 999 year lease at £25 a year so we didn't have to, not all leasehold properties are bad.

Namechangeinto2017 Fri 21-Apr-17 18:31:31

It's a common thing in the NW non of the properties are ex council possibly associated with land that was historically part of some of the large mill estates?

housesellingrant Fri 21-Apr-17 18:36:50

Property is in the NW, but not a nice reasonable rate and long tenure. Good to know some are ok and we will not discount all leaseholds (just newer build ones)

sunnysouthend Fri 21-Apr-17 19:28:13

Yes, mill estates would make sense - SE here so different experience smile
OP - hope you find a lovely (hopefully freehold) house soon!

namechangedtoday15 Fri 21-Apr-17 20:16:21

Not mill estates or ex-council here (Cheshire) but just land owners who retained an interest (the freehold). Its so common that its not even part of the sales particulars / estate agents' details. Its usually not apparent until solicitors are involved - obviously after an offer is made and accepted, as it makes so little difference.

housesellingrant Sat 22-Apr-17 06:38:50

So we have been doing some research on this issue specifically regarding new builds.
Having to be a tenant for two years is a red herring, the management company can sell to leasor at anytime, but after two years the tenant has right to buy.
The land owner can't sell individual freeholds, it sells the company which holds the freeholds, hence why in some of the articles it can't be articulated how much the free holds where sold on for.
The existing house owner can sign over their two year tenancy allowing the house buyer opportunity to purchase lease without waiting two years (this point we are going to get checked legally).
Given the clauses for increments in some of these I think estate agents/ house builders should be obliged to disclose in particulars.

namechangedtoday15 Sat 22-Apr-17 09:50:29

Yes in the case of newish houses you should be asking for those details as part of the viewing info.

Join the discussion

Registering is free, easy, and means you can join in the discussion, watch threads, get discounts, win prizes and lots more.

Register now »

Already registered? Log in with: