Buying the freehold.

[YorkshireTree]

I have just had a letter offering to sell me the freehold of my terraced house for £650. It's currently a 900 year odd lease and I pay £2 ground rent a year.

They claim it will add more value to the house than it costs. Almost all the houses like mine (Edwardian) in this city are leasehold so it's the norm.

The offer is open until July and I could afford without too much struggle but I would notice the money going and cut my costs accordingly.

Do you think its worth it? I don't really know the ins and outs.

Thanks everyone! I think I shant bother!

Busyboy unless you have read the lease you cannot be sure. I believe that what you are saying is the most common answer, but not the only answer. As these people found out an accurate answer is better than a general one.

If the Lease is an old 900 year lease then the rent cannot go up. That link refers to people who have bought new homes with new leases. They do have rent escalation clauses in them. An old terraced house will not.

If you want me to look at your Lease op and confirm I would be happy to do so. Just pm me. We can get hold of a copy from the Land Registry for £3 if you don't have a copy but your solicitor should have sent you a copy when you bought the property.

Another conveyancing solicitor here and busyboysmum is absolutely right. I'm also in a northern city and this kind of old long lease is very common. Totally different to the type others have spoken about (i.e. flats and new builds) and doesn't have any value at all. As OP says, most of the local properties will be the same.

If it costs you £2 a year, it'll take an awfully long time to be worth paying £650!

Quite possibly no coincidence that leasehold issues have been in the news recently and the freeholder is now trying to capitalise on people's fears by offering to sell. It probably costs more to recover the monies from everyone than is collected.

Quite possibly no coincidence that leasehold issues have been in the news recently and the freeholder is now trying to capitalise on people's fears by offering to sell. It probably costs more to recover the monies from everyone than is collected.

We owned a long leasehold house in the NW for a small annual ground rent as you have described. The only problem we could forsee was that if we wished to extend, we had to pay to get free holder's consent. This in itself was not expensive, but the freehold had been bought by a company who charged massive administration fees for everything. We were also tied to get our buildings insurance either through their approved policy, or get our policy approved by them (for a fee each year). Buying the freehold would have released us from those obligations. But they weren't a problem for us, so we decided it wasn't worth the expense. You need to read your lease to inform your decision.

Financially its not worthwhile, BUT if it falls into the wrong hands they can cause problems on sale as this gives them the opportunity to be awkward and in the middle of a sale they may get a sum of money from you

If you can afford it, make an offer of say £400 but speaking as the owner of a number of terraced houses I would - its all about peace of mind and if one of these ground rent grazers acquires your freehold life could be made unpleasant

I previously lived in a flat where the lease stated the annual rent was a peppercorn. Up until then I thought it was just a phrase. No one ever turned up to claim it mind.

@namechangedtoday15 Interested to see this thread. In the case of a long leasehold with low fixed ground rent, can there be an argument that you don’t technically ‘own’ the land marked on your deeds, -which you may be using as parking area? Others may try to say it is more of a ‘communal area’. So perhaps buying the freehold could help in that situation?

The answer is certain: buy it.

I have experience of someone who declined an offer to buy the freehold (house, like yours) and when trying to sell the lack of freehold (leasehold houses existed but were not the norm in the area) caused buyers much confusion.

Furthermore much later on (the house was never sold) even more problems arose when the freeholder could not be traced and it took 12 years of occupancy for a solicitor to get the freehold via the Land Registry- all costing far more than the freehold would have done when offered.

For me, I would not consider buying a leasehold house unless there were exceptional circustances.

The 900 odd years, and tiny ground rent may make it practically the same as a freehold, but it is so much clearer not to have anyone else with an interest in the property.