Landlord auctioning the freehold to my property

[elephantoverthehill]

I have been informed that the landlord is going to auction the freehold to my property and 3 others in the street. The lease is a term of 999 years from 1896. My question is how might this affect me and my neighbours? I can bid but what would advantage would it be to me? I'm a bit confused. Should I consult a solicitor? Any help gratefully received.

It’s less a benefit, it’s more do you want to risk someone else buying it and charging you ridiculous service charges. Someone will only buy it to make money out of you.

Thank you for your reply @CraftyNavySeal . That was what I was worried about. The thing I don't understand is I have never known to pay a ground rent on this property and I own it outright.

Service charges don’t go to the landlord and should be held in trust as per the LLTA.

As you have a 999 year lease, it’s unlikely to be very advantageous to own your freehold, although some purchasers do like having a share of freehold as and when you come to sell. It would give leaseholders marginally more control over some aspects of living there - the right to place insurance, appoint a managing agent and grant permissions for alterations.

if all the flats are on 999 year leases the freehold is likely to be relatively cheap as it’s likely that there’s very little income stream associated with the block.

They won’t be able to charge service charges unless they provide services.

OP is this a block of flats that benefits from services, or a house built on land someone else owns?

that would drive my decision. I wouldn’t want to arrange my own services so that would be a no. If not, I agree with LBO, unlikely to have much advantage but check how much it costs and if it’s cheap maybe consider it with the other owners

The four houses on the street are all semi detached properties.

Also if the lease was 999 years from 1896 there is about 870 years left now. Still a long lease though. Is your property a flat? Are there any ground rent or service charge provisions in the lease?

In that case I assume you don’t have any services - I wouldn’t worry at all really. It must be pretty worthless tbh. Have they given you any idea how much it’ll go for?

Sorry just seen your update, it's a house. What does your lease say.? Do you currently have to get freeholders permission for anything?

As far as I know the four properties in question are all privately owned. I have never heard of the 'freeholder' until I received two copies of a letter explaining about the auction. One letter arrived by usual post the other copy I had to sign for. I understood that with a freehold property one owned the property and land as opposed to leasehold, but it seems I have got that wrong😀

Oh and never been aware of getting permission for anything. I guess I will have to dig out the deeds.

The freeholder of my mother's house frequently offered to sell the freehold to her, similar length of lease left to OP. I think the price was down to £300 by the time she died. The ground rent was £5 per year. It's pretty common in some parts of the country for houses to be leasehold with a miniscule ground rent

Honestly if you are not sure, seek legal advice from a solicitor.

Thanks all, I guess we will have to consult a solicitor.

Our old house was freehold with a ground rent. I’d never heard of it but apparently it’s very common in some parts of the country. The ground rent was around £5 per year. We paid £100 around 20 years ago to lift it.

That was a rent charge @WutheringTights . It’s a different thing.

You need to get someone look at your lease OP.

If you are able I would absolutely buy it . It’s security and assurance for when / if you sell the property. Leasehold has become a dirty word and a lot of people won’t even look at a leasehold property.

Agree, just buy it. There are so many horror stories of leasehold it hugely puts people off.

It’s likely there’s a power to collect one in the freehold title and whoever buys it is likely to impose charges. I would buy if there’s anyway you can. Will increase the value you of your property too to be able to sell as freehold

Check your deeds, if it’s freehold or leasehold it will say. If it’s leasehold (which seems the case) i would definitely buy it if it’s affordable to you

They won't necessarily be able to impose charges or increase the ground rent - like I said, it's pretty common in certain parts of the country, and since forcing the house owner to take out the freeholders choice of insurance became illegal, there's very little the freeholder can do

Are they selling the freeholds in one bundle or individually? If it was reasonably cheap I would definitely buy mine, not sure if I would want the others, but I might buy them all if that was the only way to get mine. Could you find out how much the guide price is and make a reasonable offer for yours (directly to the freeholder) before the auction?

I'd 💯 look to buy with your neighbours or buy it yourself if you can at all.

We bought a house that was leasehold, and also bought the freehold (it was about £1.5k I think).