buying leasehold

[iskra]

Does anyone know any potential pitfalls of buying leasehold? We have just had an offer accepted on a leasehold house in the northwest. The estate agent seemed surprised that I queried the leasehold - it has 900 years to run or something - & said that most houses in the area were leasehold. Ground rent is £16 a year or something. He couldn't tell me who the leaseholder was.

I was surprised because we are currently in a leasehold flat in London & it's a bit of a pain because the freeholder is AWOL & there are only 80 years to run on the lease - it's all a bit of a pain & I would have preferred a freehold house (thankfully we don't own). But I know leasehold is pretty standard on London flats.

Any issues to highlight?

Your solicitor (and the seller) will have to identify the freeholder in order for the sale to go through - properties can be sold if the f/her has disappeared but it is very complicated and drawn out. Once you're in, apply to buy the freehold - you can ask to do it straight away otherwise, I think, you have the absolute right to buy it after two years providing that the f/h doesn't belong to certain bodies such as Crown Estates. With that amount of time left on the lease, and that ground rent, it shouldn't be at all costly.

The obvious pitfalls with a leasehold is that it is more like renting a property than owning it - in theory you are only paying for the right to live there so any alterations (including sometimes exterior colour and so on) has to be approved by the f/her. There are lots of rules and regs in place about how often you should repaint the house, what you can do with it (may not be able to sub-let, work from home etc), whose responsibility repairs are - you will always pay for them but the f/her should arrange them and will then charge a fee and so on and may not do them without a lot of nagging etc.

Speak to the current owners about how the f/her behaves and, if you really like the house, buy it if you think you can get the f/h in a couple of years.

You see, this is exactly what I thought was the situation with leasehold. The estate agent (who I realise isn't a solicitor) was surprised when I said pretty much what you've said to him about upkeep/alterations etc. He said it wasn't the case in the area?? Anyway, we will be getting our solicitor to look at it closely. Unfortunately it's a repossession so no information from the current owners AND they are insisting we exchange within 28 days...

Some f/hers watch over their properties and keep tight control of everything, others don't bother. Could be that this f/her is a bit slack (which may give you more freedom but could mean that communal repairs etc don't get done). If it's very common for the area, knock on some neighbours' doors and ask around about them.

its not too bad. My lease was 999 years house about 40 years old. Just drop a letter recorded delivery to leaseholder when doing major works - extensions etc but never had a problem at all don't think they're interested as long as ground rent is paid! Just get solicitor to check lease for covenants stipulating what you can and can't do to get an idea of how restrictive it is.