London Flat sold for 22.5k - how can this be?

[simpsons1]

Just looking up an old neighbourhood, and saw two Abraham flats - sold in Francis Rd, Leyton from over 300k one year, to just 22.5k in 2021. Can’t see any fire damage, don’t think there would have been floods - even with repossession flats in London can’t be that cheap. Anyone know why it might be? (Address are 119 and 121 Francis Road, Leyton, E10)

Inheritance dodge. Sold to family member.

a very short lease?

Probably a divorce. My friends house shows as selling for £5k. It's worth £300k but it was down to her buying her ex out

Yes maybe sold to family - but looks like went through auction site for both flats - 119-121. Lease was 49 years for one - but I know the company Abrahams and extensions are possible.

You can give your house away if you want - so you can certainly sell, for example to a family member, for 22.5k if you choose to. Perhaps that was the amount remaining on the mortgage or the amount they were short to buy another property for the deposit or cash outright so had to charge something.

Ah, I didn’t think of divorce. That makes sense - it would be registered as change of deeds so would show up. Though in this case it seems to have gone through an auction site. It made me wonder whether something more suspicious.

It sold for 356k in 2015 so don't understand that guide price

I know, it’s odd isn’t it. I didn’t think about divorce sales or family sales but don’t think they’d usually go through cautions. House/flats look ok on outside on auction sale picture so made me think maybe not fire. Even if ?crime in the house surely guide price would not be that low.

Someone murdered there?

Cannabis factory/den?

Sold cheap to a relative or business partner?

Sorry typo - auctions

Cannabis factory might go through auction I guess? But are ex- cannabis houses totally trashed? That’s just so so cheap for London.

.

Sorry, I see you have already posted that.

www.movehut.co.uk/property/370794-119---121-francis-road-leyton/

Investment for auction but has now been removed. Guide price £46,000

Shows where? I bought my ex out. I don't think any part of the process was shown anywhere.

Looks like it's the freehold ground rent that has been purchased. Not the leasehold itself.

On the Land Registry or Rightmove it shows historic sales prices. On my friends it showed the purchase price in 2015 when she and her ex bought it then it shows a purchase price in 2019 of £15k (not 5k) - that was when she bought him out & took on the house herself. It doesn't say that's what it was I just know from the dates & amount

CharlotteBog
Shows where? I bought my ex out. I don't think any part of the process was shown anywhere.

On the Land Registry or Rightmove it shows historic sales prices. On my friends it showed the purchase price in 2015 when she and her ex bought it then it shows a purchase price in 2019 of £15k (not 5k) - that was when she bought him out & took on the house herself. It doesn't say that's what it was I just know from the dates & amount

That's what I mean, mine doesn't show this. It shows my house purchase price in 1996 (when we bought as a couple) and that's it. I bought my ex out in 2017. We were mortgage free so I had to get a mortgage to pay for my 1/2 of the house. I think that is a transfer of ownership so maybe wouldn't show anywhere.

Any lease under 80 years is insanely expensive to renew. They'll have been cheap if the leases are under that, and practically given away where leases are under 50 years.

But that’s still cheaper than one years rent in a comparative property.

If they were truly giving away short leases it would be common to buy one of these instead of renting, accepting you’ll need to find a new property at the end.

For 22 grand and only 50 years on the lease you would live in it or family would then just walk away when lease ends and you would be quids in with the money you would have saved in rent. Or buy it , rent it out and make money that way.

If you buy a leasehold with under 80 years lease remaining most lenders won't let you borrow against it. Freeholders can basically name their price for the lease renewal.

This would have been a cash purchase as it only had 49 years remaining.

Really interesting replies thank you - crazy to think that in theory you could buy in cash a flat to live in for 22.5k but just with the knowledge that you only had it for the remains of the lease.
I think on balance this sounds like a lease purchase or a divorce sale. Currently in the market to buy -but with limited budget so really interested in the different possibilities. Though of course will probably end up with ‘normal flat/house’ price situation.

Late to this thread, I know, but I would bet it was the freehold that was sold and not the leasehold.

Rightmove just pulls sales values from the land registry and isn’t brilliant at distinguishing what title was sold.

Same - planning on buying our freehold and we’ve been quoted £12k. Our lease is 89 years, so would be more if the lease is shorter.