Ground rent advice?

beyond the blue

beyond the blue

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Neil
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I bought my house 42 years ago, from what I can remember it had a 99 year lease at the time. The ground rent is £12 per year and has never increased. The lease holder has changed once since I bought the house. I have just received this years invoice together with an offer for me to purchase the freehold for £900, add on solicitors costs and fees and the total amount would be £1,500. I am 66 years old (married) and don't intend selling the house (God willing), and plan on leaving it to the kids. I have read recently about leaseholds being sold on with huge yearly increases being charged and wondered if it would be a shrewd move to buy the freehold. What does the panel think and has anyone any advice?
 
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Yep buy it ,it will put thousands on the real term value of your house it’s a no brainier
 
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Buy it, you may not want to sell but your kids likely will and you'll potentially save them some money and hassle.
 
Buy it. I've heard of freeholds costing well in to the £000s so around £1,500 all in sounds good.

Hopefully the house being going to your kids won't be for a good while but when it does happen the remaining lease might be pretty short. Should your kids then want to sell the house they might have a problem.

Dave
 
Talk to a solicitor but I'd say buy it (IANAL!). As people have said above, owning the house freehold will add significantly more value to it than buying the freehold will cost you.
 
nilagin said:
Not if they decide to sell the free home to someone else, who may even put the ground rent up.
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I didn't know it was possible to do that - but I guess it figures. Looks like it can get very messy though with substantial fines for getting anything wrong.

https://www.lease-advice.org/advice-guide/right-first-refusal/

The lease holder would have the easiest life if they sold it to the house owner so the price should be negotiable. Maybe I wouldn't be quite so aggressive with my first offer now I know other people can buy it ;)
 
JonathanRyan said:
I didn't know it was possible to do that - but I guess it figures. Looks like it can get very messy though with substantial fines for getting anything wrong.

https://www.lease-advice.org/advice-guide/right-first-refusal/

The lease holder would have the easiest life if they sold it to the house owner so the price should be negotiable. Maybe I wouldn't be quite so aggressive with my first offer now I know other people can buy it ;)
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I've just written to my solicitor to ask her opinion.
 
Buy it.
Your kids would struggle to sell the house with that short a lease, and renewing a lease can be a very costly business.
Any prospective buyers would find it very difficult to get a mortgage.
 
Be careful if it's a flat/maisonette as Lenders can be put off by freehold properties of that type, they prefer houses either terraced, semi or detached. Same with Equity Release Lenders, which you may not be considering now but you don't want to close that door, just in case.
I worked for an Estate Agent and we had real problems shifting some freehold properties, which is really counter intuitive.
Increasing the length of the leasehold would definitely be worth considering.
Matt
 
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Buy it, nobody will be able to get will mortgage on a property with less than 60 years on the lease, so you open up the market when you, or your heirs, do come to sell.
 
MatBin said:
Be careful if it's a flat/maisonette as Lenders can be put off by freehold properties of that type, they prefer houses either terraced, semi or detached. Same with Equity Release Lenders, which you may not be considering now but you don't want to close that door, just in case.
I worked for an Estate Agent and we had real problems shifting some freehold properties, which is really counter intuitive.
Increasing the length of the leasehold would definitely be worth considering.
Matt
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It's a 3 bed semi Bungalow.
 
Buy it, no doubt about it. If the freeholder wants to sell he has to offer it to you first and if you don take it up the freehold will be put on the market and the ground rent will go up. Anybody would have a huge problem selling the house with such a short lease as it would cut out anybody with a mortgage. It really is the best thing to do.
 
Just my view of the world, so to speak.

Sounds like a good deal for your future net worth and gifting it(?) to your children. Short leases are a mare and can cost, as mentioned above, something between 10 to 20 the figure you posted to extend a lease.

Yes, you need a solicitor to sort the legal stuff.......you mention it is semi-detached. Thinks out loud ~ is next door also leasehold of already freehold??? The reason I ask and of course your solicitor should cover all this (NB hopefully her fee will not be that high!) is what about "party wall" interests. I.e. where there is freeholder and leaseholder & a freeholder only the ''other side' who pays for any structural work. I know I sound vague but make sure all i's dotted and t's crossed.

Sounds like a bargain for you :)
 
Definitely get legal advice.

Friends of mine were offered the freehold for a few hundred poundsof a house converted into 6 flats they lived in.]
Being someone who was always in for a cheap deal, the wife wanted to do it.
I persuaded them to take advice first, mainly because as the leaseholders they would be liable
for the maintenance of the main building which could get very expensive, far in excess of their
present service charge, she told me I was talking rubbish.
Luckily her partner did as I said and realised just how much extra they would be paying, insurance
maintenance etc . so it was sold off elsewhere with little effect TBH.
They did end up in a legal battle with the previous owner, he removed a grandfather clock they had
in the hallway and sent it to auction, luckily it was returned eventually
 
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