chestnutmare Posted February 15, 2011 Share Posted February 15, 2011 Question is in the title really. We are looking at properties and notice several that are leasehold. Would you buy a property that is leasehold? Yes/no/why I've had some differing opinions so far! Thank you. Quote Link to comment Share on other sites More sharing options...
Olly Posted February 15, 2011 Share Posted February 15, 2011 One thing to consider is mortgages - some lenders will not lend on leases at all , most will but it needs to be at least 75 years. Leasehold is more common in some parts of the country than others. It depends a lot on what sort of lease - is it a flat in a block, for example? Quote Link to comment Share on other sites More sharing options...
Jools Posted February 15, 2011 Share Posted February 15, 2011 I probably would, yes. Obviously it would depend on the property and where it was. I imagine they're less expensive than freehold so it could be a good way to live somewhere you wouldn't necessarily be able to afford otherwise. Quote Link to comment Share on other sites More sharing options...
Bramble Posted February 15, 2011 Share Posted February 15, 2011 You will almost certainly need to extend your lease if it has less than 50 years unexpired (mortgagees will not lend on a property with less and many will insist on more than 75 years plus). Even if you don't need a mortgage, you need to consider future sales of the property to people who will need a mortgage. I would want to try to extend the lease anyway (unless its a 999 year one, that should be long enough for most people!) You could even enquire about buying the freehold, but you will definitely need to find out the cost of extending the lease before you agree to buy. Quote Link to comment Share on other sites More sharing options...
Omletina Kyckling Posted February 15, 2011 Share Posted February 15, 2011 My parents' bungalow is leasehold, and it doesn't give them any problems, the "rent" they pay is peanuts and they have been offered the opportunity to buy the lease to make it freehold, but it didn't seem worth it. Quote Link to comment Share on other sites More sharing options...
chickenNutter Posted February 15, 2011 Share Posted February 15, 2011 We are in a leasehold property in a part of the country where leasehold is common - all stems from the Lord of the Manor selling off a huge chunk of their land to create a new garden town in the Victorian era. Eventually the family died out and the leases have changed hands - companies buy them not for the rent which is a peppercorn rent of £2 -3 per year, but you can't do any alterations to the external footprint without their permission, and that is where they sting you, charging a significant amount of cash for an extension, for example. Having said that, we had no problems at all getting a mortgage as it is common round my way, it does not put buyers off and have no plans to do any building. Plus the lease has no restrictive covenants on about chickens - I just cant start a brewery or an animal rendering business on the property! It depends on what you want to do with the property, and as others have stated, the length of the lease if you require a mortgage. Hope this helps Quote Link to comment Share on other sites More sharing options...
craftyhunnypie Posted February 15, 2011 Share Posted February 15, 2011 I wouldn't. Much prefer freehold & knowing that it is all fully mine. I like proper security. Obviously it's what suits the individual. Emma.x Quote Link to comment Share on other sites More sharing options...
Egluntyne Posted February 15, 2011 Share Posted February 15, 2011 We did, and then later bought the lease. Quote Link to comment Share on other sites More sharing options...
PurpleTree Posted February 15, 2011 Share Posted February 15, 2011 Our previous house was a ground floor flat which was leasehold. The ground rent was only a couple of pounds a year which was paid to a solicitors. As part of it we had to have our buildings insurance with a certain company, it was organised by the solicitors we paid the ground rent to. We had to pay it all in one go to them, they then sent us the documents. Wasn't the cheapest place either As others have said you have to be careful how long is left on the lease. Ours was getting close to the amount needed by mortgage companies when we sold it. Luckily the lady who bought the flat didn't need a mortgage so wasn't bothered. We did look into extending the lease, but it was going to cost over £10,000, which we just couldn't have afforded at the time. To buy the leasehold we needed all 4 flats in the block to agree & buy together. I think it all depends on the individual property & find out all the in's and out's. Think the estate agent would be able to tell you the important bits. Quote Link to comment Share on other sites More sharing options...
C&T Posted February 15, 2011 Share Posted February 15, 2011 Did as bought a flat a couple of homes ago. If you do, just make sure you know of any associated costs, and what (if anything) they are responsible for. (In our case, they were supposed to maintain all the communal areas - but they were a pain in the neck, used every opportunity to fleece us, so we would do any painting and general maintanence ourselves as was cheaper for us! But guessing that is a flat issue rather than a house thing...) Quote Link to comment Share on other sites More sharing options...
Charlottechicken Posted February 15, 2011 Share Posted February 15, 2011 Personally I would only buy leasehold if I knew I would be able to buy the freehold. However, there are a couple of large areas of south Birmingham (namely Bournville, owned by the BVT, and Edgbaston, which is Calthorpe estates) where freehold is near impossible to obtain but the addresses are sought after. The leases are usually 999 years and will never be sold so getting a mortgage would not be a problem. Something to consider though, I believe that buying a lease has increased in value fairly recently, so if you were thinking of going down the route of eventually buying the lease, it might be worth doing a bit of detective work to estimate the cost and then factoring in to your budget. Quote Link to comment Share on other sites More sharing options...
majuka Posted February 15, 2011 Share Posted February 15, 2011 We had a leashold property before (a flat). We paid a modest service charge monthly which covered our buildings insurance and maintenance of the flat. Our lease was very restrictive in what work we could have done in the flat. I don't think that I would buy a leashold property again. Quote Link to comment Share on other sites More sharing options...
Daphne Posted February 16, 2011 Share Posted February 16, 2011 When I bought a flat many years ago, virtually all flats were leasehold. It was fine, except when the time came for major refurbishment to the building, suddenly there was an estimate for thousands of pounds (although in the end some of us leaseholders did most of the work ourselves and saved money). Now, I'd buy a leasehold flat again, but I'd check the lease period and conditions very carefully. I had a worse experience when trying to buy a freehold property on a country estate which was being sold off for the first time. Although it was freehold, the owner wanted to impose contractual conditions like 'you will repaint it colour X every 5 years', and 'you won't keep a caravan or a boat' (despite the fact the cottage had an acre of land ). We had a dreadful period of negotiation and in the end he pulled out of the sale. Quote Link to comment Share on other sites More sharing options...
Aunty e Posted February 16, 2011 Share Posted February 16, 2011 Never, ever, ever, ever again. Slightly different situation for us as our leaseholder was hackney council (property was an ex council flat in a block). Over ten years we were routinely sent enormous bills for 'essential maintenance', which we supposedly had the right to object to at the planning stage. We objected, they did it anyway as they still owned the majority of flats in the block. It cost us £10k for a new roof, replacing one which was only eight years old, and of that £10k, £2k was administration charges. £1500 for security doors, £400 for new water tanks, the list goes on and on and on. In the end I insisted we moved when the service charge per month cost more than our council tax(£130 per month), for which we received lighting in the communal corridors and a man with a mop twice a week. I repainted the woodwork, filled the cracks in the ceiling and repainted it when we were selling our place, as obviously "Ooops, word censored!"ody else was going to. When they replaced the lintels on all our doorframes and windows (for which they charged us, even though we disagreed with the necessity and so did our surveyor) they cracked the frame to our patio doors, which we had to replace (£1100). When they replaced the roof they put scaffolding up in MY GARDEN, without asking, damaging the patio, leaving it there for two months as a security risk, and when it eventually went, they left all of their building rubble in my garden. And our building insurance had to be done through them, and was hideously expensive. And we still got burgled despite the poxy security doors which never worked. Quote Link to comment Share on other sites More sharing options...
chestnutmare Posted February 16, 2011 Author Share Posted February 16, 2011 Oo some bad experiences here. I should add that it seems many modern houses here are leasehold. Not flats, I'm talking houses. The lease doesn't seem to include anything like maintenance but a fee to basically for the land. The house itself is bought and would be ours. I know it can restrict things such as extensions etc. I know some people have managed to pay and get their place freehold. I have been told that you are entitled by law to buy the lease on the house after 2/3 years and by law a reasonable price must be offered. Quote Link to comment Share on other sites More sharing options...
Clur Posted February 16, 2011 Share Posted February 16, 2011 Never, ever, ever, ever again. Slightly different situation for us as our leaseholder was hackney council (property was an ex council flat in a block). Over ten years we were routinely sent enormous bills for 'essential maintenance', which we supposedly had the right to object to at the planning stage. We objected, they did it anyway as they still owned the majority of flats in the block. It cost us £10k for a new roof, replacing one which was only eight years old, and of that £10k, £2k was administration charges. £1500 for security doors, £400 for new water tanks, the list goes on and on and on. In the end I insisted we moved when the service charge per month cost more than our council tax(£130 per month), for which we received lighting in the communal corridors and a man with a mop twice a week. I repainted the woodwork, filled the cracks in the ceiling and repainted it when we were selling our place, as obviously "Ooops, word censored!"ody else was going to. When they replaced the lintels on all our doorframes and windows (for which they charged us, even though we disagreed with the necessity and so did our surveyor) they cracked the frame to our patio doors, which we had to replace (£1100). When they replaced the roof they put scaffolding up in MY GARDEN, without asking, damaging the patio, leaving it there for two months as a security risk, and when it eventually went, they left all of their building rubble in my garden. And our building insurance had to be done through them, and was hideously expensive. And we still got burgled despite the poxy security doors which never worked. Similar experiences for us too unfortunately. We had a private flat in a block of mostly housing association flats. Absolute nightmare - we had to pay over the odds for painting and decorating of the communal areas, even though the contractors spent most of their time sunbathing. We sold up just before the security door gaff - they never worked properly and all the private owners were charged thousands for them. Quote Link to comment Share on other sites More sharing options...
chestnutmare Posted February 16, 2011 Author Share Posted February 16, 2011 Similar experiences for us too unfortunately. We had a private flat in a block of mostly housing association flats. Absolute nightmare - we had to pay over the odds for painting and decorating of the communal areas, even though the contractors spent most of their time sunbathing. We sold up just before the security door gaff - they never worked properly and all the private owners were charged thousands for them. Oh dear. However, the places we are looking at are houses, not flats. There would be no maintenance work being carried out, just a fee for 'renting' the land our house (bought) would be on. Quote Link to comment Share on other sites More sharing options...
C&T Posted February 16, 2011 Share Posted February 16, 2011 I wouldn't rule it out on principle - just go in with your eyes open (like you are already) and maybe try to speak to potential neighbours to see if they have anything to say about the Lease Holders, and whether they have experienced any issues as a result. (Rather than asking the person you are buying off, as they may not tell the whole story...) I think some Flats are the worst example, and I have experienced a small slice of that, but would hope a house would be much easier. Good luck with the house hunt! Quote Link to comment Share on other sites More sharing options...
chestnutmare Posted February 16, 2011 Author Share Posted February 16, 2011 Funnily enough, I was thinking of speaking to neighbours earlier on today. I know some of the houses there are now freehold so some have bought the lease. Thanks for the luck, think I need it. Quote Link to comment Share on other sites More sharing options...
abwsco Posted February 16, 2011 Share Posted February 16, 2011 Like Kate said previously nearly all houses in our area are leasehold. No prblmes apart from needing permission if you wnat to do building work. Quote Link to comment Share on other sites More sharing options...
sadietoo Posted February 16, 2011 Share Posted February 16, 2011 Just read through the posts and I'm just wondering why you would buy a flat that wasn't leasehold? (unless of course you had the opportunity of joinly owning the freehold with the other owners through a management company) Surely you'd want to know that the other owners (and particularly your downstairs or upstairs neighbour) was accountable for the condition of the fabric of the building too? Perhaps I am very out of date...it's nearly 30 years since I had a leasehold property Quote Link to comment Share on other sites More sharing options...
chestnutmare Posted February 16, 2011 Author Share Posted February 16, 2011 Just read through the posts and I'm just wondering why you would buy a flat that wasn't leasehold? (unless of course you had the opportunity of joinly owning the freehold with the other owners through a management company) Surely you'd want to know that the other owners (and particularly your downstairs or upstairs neighbour) was accountable for the condition of the fabric of the building too? Perhaps I am very out of date...it's nearly 30 years since I had a leasehold property Is this for me??... I'm not looking at a flat, I am looking at houses. It seems many modern houses here (not flats) are leasehold. Quote Link to comment Share on other sites More sharing options...
sadietoo Posted February 16, 2011 Share Posted February 16, 2011 Just read through the posts and I'm just wondering why you would buy a flat that wasn't leasehold? (unless of course you had the opportunity of joinly owning the freehold with the other owners through a management company) Surely you'd want to know that the other owners (and particularly your downstairs or upstairs neighbour) was accountable for the condition of the fabric of the building too? Perhaps I am very out of date...it's nearly 30 years since I had a leasehold property Is this for me??... I'm not looking at a flat, I am looking at houses. It seems many modern houses here (not flats) are leasehold. No sorry, not directly replying to your post....others were implying leasehold flats were an altogether Bad Thing.... Quote Link to comment Share on other sites More sharing options...
chestnutmare Posted February 16, 2011 Author Share Posted February 16, 2011 No sorry, not directly replying to your post....others were implying leasehold flats were an altogether Bad Thing.... Oh right. There does seem to be some mixed reviews over leasehold. And then it depends on how long the lease has left etc... it's confusing for a first time buyer like me. Thank goodness my mother is of some help as she's moved so many times over the years. Quote Link to comment Share on other sites More sharing options...
sadietoo Posted February 16, 2011 Share Posted February 16, 2011 Sometimes, and the point I was questioning, it seems that leasehold is a positive thing...but as in your case if you are looking at leasehold houses, it seems it may just be a way of a developer getting the maximum profit for his investment ...(or in other words a licence to print money), and then it depends very much on the terms and length of the lease. Leases of less than 50 years are "wasting assets" in other words you can expect them to depreciate in value annually. I would only advise that you should take independent legal advice before entering into any agreement to purchase a lease...In my experience many solicitors dealing with conveyance take it for granted that you have understood the restrictions and possible pitfalls of a lease property..when in fact you need them to spell them out to you....make sure you do, and good luck... Quote Link to comment Share on other sites More sharing options...
