I mentioned this jokingly on another thread but now wondering whether it's actually workable. We bought our flat leasehold five years ago and then bought the freehold (shared with other two flats in the building) a few years after that. We are now selling but it is on the irritating stamp duty cusp which means we are unlikely to get offers over £250,000. Would it be possible to sell the leasehold and then sell the share of freehold separately to avoid going into the next stamp duty bracket? I suspect not from my quick and unknowledgeable reading of HMRC's website, but another poster said that she sold a flat and garage separately because of this issue.
No because the two sales would be deemed to be linked. Only way you could do it would be to wait for longish period - say a year or more - and not let the buyers know that there was any possibility of buying the freehold until you then offered it to them. Also, freeholds for flats of that value, unless the lease is very short, only cost a couple of thousand so it would hardly be worth the effort.
I agree with lala although I'm hearing of freeholds going for an awful lot more than a few thousand!
I sold my flat complete with the freehold to the flat upstairs. Before I sold I offered to sell her the freehold to her flat for 2K - she turned me down! I subsequently hear that the present freeholder wants 15k and she has 68yrs left and can't sell. Me thinks he is eyeing it up to convert back into a (cheap) house!
It used to be that many mortgage lenders were unwilling to lend with a lease under 75 years. I'd class 70 years as short. What tends to happen is that it reduces the price as a potential buyer has to factor in the possible extension as a cost.
70 years is short but, as you own a share of the freehold, there is nothing stopping you from extending it to 999 years for the cost of a solicitor's fee (couple of hundred quid). Am amazed whoever handled the original conveyance didn't suggest you do this at the time. If the lease has more than 80 years to run, then the tenant has automatic right to extend it at virtually no cost so that is why buying a share of the freehold in those situations - where "marriage value" does not come into play - is a relatively cheap exercise.
Excellent, thanks. I am also a little surprised that the lease hasn't been extended yet, but it took an extremely long time to sort out, by which time I'd moved 200 miles north while heavily pregnant, leaving the co-owner and other flats to sort out the final details, and our solicitor was rather - hmm - laidback