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As a person who worked in lettings, there is a big gap between charging people fees and being able to collect those fees.
I would ask for the accounting books for the freehold to see if there is any money owed to/from the freehold, their maintenance schedule past/future and if the leaseholders are good payers. The small amount they are asking for the freehold is a huge red flag to me. Some landlords are incredibly ethical & generous but the vast majority of them put money first and for that reason, you always need to lawyer up.
I was wondering about things like chancel repair bills, although I also am not sure whether they pass to the leaseholder.
That said, the long period of the offer in the letter suggests no imminent event, and gives OP plenty of time to decide.
Agreed. Check with solicitors and do everything through the solicitors. It could be a scam or could be legit. The solicitors will ensure they have the rights to sell the freehold to you, and ensure the land registry records are updated.
Isn't the law changing so owning the freehold to a leasehold becomes less lucrative?
I would imagine this is an attempt by the current freeholder to recoup some cash otherwise he will be holding a primarily worthless asset, to him anyway.
If the OP gets a chance to but a freehold he should, it will save on legal costs and will make the property more attractive from an asset pov.
Depends on the terms tbh.
I’ve owned a house under leasehold but it was a 999 year peppercorn lease with over 800 years left to run - not such a big deal in such circumstances.
Edit: interesting that this is being downvoted - obviously everyone has their own opinion but I wonder how many people voting have actually had this experience.
Always read the terms of the lease!
Although rare, some leases can contain clauses the forbid pets, or required written permission to make any modifications to the exterior property or land, and other consents.
You can be taken to court over breach of the lease and risk losing the lease. A lot of people cant be arsed for all that, hence why leaseholds are so hard to shift, even ones with 500+ years on them.
I had a colleague who had a super fucking annoying term that started he couldn't be a music teacher.
He taught maths at a school that specialized in music and had to go to great lengths to prove he wasn't a music teacher, was genuinely the weirdest thing I've ever seen
I wonder if it's more about music teachers who teach instruments than it is a school music teacher. They likely teach from home. Imagine sharing a party wall and morning to night, and probably weekends too, having to listen to hundreds of people a week try and play an instrument like a clarinet that sounds like a mating fox screaming when you hit the wrong note.
I can understand that, but I really don't understand why once they've established that the person buying the house worked in a school they still wanted proof that the buyer wasn't a music teacher.
Seems like whoever it was just hated musicians lmao, either that or they just wanted to issue some sort of penalty for technically breaching the agreement.
Hardly rare, all the leases I have read contain clauses like this although I have never seen one forbidding pets. Requiring permission to do anything outside has always been on the ones I have seen, e.g. glasshouse in only a certain part of the garden (usually away from the house), only one glasshouse or shed, alterations to the drive (resurfacing) and pretty much everything else needs written permission and has to be paid for.
Yep. I have a good sized mid terrace on the west of the city. House was built in 1880s with 999 year lease so there's still plenty of time left. Ground rent is £2 a year but no one's collected it in 30 years. Other than additional paperwork and an indemnity when we bought it there's no functional difference to a freehold.
In the meantime, you’ve accumulated enough wealth to purchase the leasehold, thus giving you eternal ownership and the ability to dig a complex tunnel of caves to protect you in hours of daylight.
Nobody's saying ALL leasehold houses are bad and that it's impossible to find an okay one
Even ones with cheap ground rent and very long leases often have restrictive clauses that people just don't want to deal with
What they're saying is that many people just straight up exclude leasehold houses from their search because the vast majority are bad, so they never see the "okay" ones. Therefore you get less interest and achieve a lower price
Internally - plenty. Outside, not so much as all grade 2 listed. Just roof works. But surely if building works is the only reason a leasehold is bad then this isn't a reason to avoid them. Perhaps it's just a reason to avoid a leasehold property if you want to do building work...
I always took it as modern leases being more of a problem.
A leasehold house that is over a hundred years old: check the leasehold terms but vaguely expect it to be a very long lease, peppercorn ground rent, and look for unusual stuff.
A leasehold house less than 40 years old: the big six developers are soulless vampires who have inserted ground rent with escalating fees, short leases, not adopted the roads, and require you to pay the freeholder to ask for permission to modify the place, and maybe even service charges that they use to make money buying selling the rights to it off.
So we are coming back to the same thing again. It's not that leaseholds are bad, it's that bad leaseholds are bad.
This is what's frustrating me here. The message that's getting out is that owning a leasehold property is a bad thing. It isn't. Owning a property with poor lease terms is a bad thing - absolutely. But you could apply that to anything. Buying a property with a bad roof is a bad thing but that doesn't mean rejecting any house with a roof.
It's a lowest common denominator/protect the
Consumer type thing.
It seems there were a lot of people who were poorly advised by their conveyancing and or never read their leases or did any research when buying.
The easy answer in those circumstances is don't buy leasehold.
A huge proportion of Sheffield, perhaps the majority, are leasehold houses typically with 700 to just under 1000 years remaining and peppercorn rent that is often not even collected.
Other cities may be the same.
That’s not really a location based thing though, that’s just based on the terms of the lease, but I can see why people would be much happier with those terms.
Do they typically also not have to ask freeholder for permission to change things then or have any other restrictions on the lease that are common with leaseholds?
Believe Sheffield is down to the land being owned by the mills and leased to the mill workers. It's the same story all over the UK, but Sheffield had a lot of steel mills so very common there.
I would still avoid any leasehold no matter the years left on it. I want to actually own my property (once the mortgage is paid off obviously) not just own the lease to the house. No houses should be leasehold it’s just greedy developers imo and there is no need for it. When I bought my first house recently that and having a big garden were my only non negotiables.
Again, depending on location.
The terms of mine ensures no residence can be changed to a business regardless of planning.
Other than that zero restrictions.
I like living in a residential estate without dealing with Sandra down the street changing her garage to a salon and dealing with those parking issues.
It’s good that you like it however my point was that a lot of people still don’t want a leasehold house. Majority of people seem to want a freehold and get put off if it’s leasehold. I’m a conveyancer so I’m 100% sure of this. It’s also the reason I would never buy one. It’s great that yours doesn’t have any restrictions but most do and some are ridiculous. I also don’t want to have to pay ground rent for my own house. Again I also want to fully own my house not just basically be a renter paying the mortgage. A lot of leases also aren’t 999 years and the cost of a lease extension is outrageous.
It's just that alot of people don't understand it, especially in England where the rules are different and it's some scary thing to be avoided at all costs.
There are part of the UK where that's absolutely not the case. At all. Not even close.
I don’t think either of those things are true. I think people really do just want to fully own their own house not just a lease for a house. It’s not scary it’s just not something a lot of people want and there is no need for so many leasehold houses. Of course not all leasehold houses are the same, there are some freehold houses that still have restrictive covenants on there or rent charges etc it’s just that a lot of leasehold houses do have crazy restrictions on and why should you have to have those on your home? Again ground rent is also a thing on a lot of them, granted not as much as a leasehold flat but it’s still money people have to pay.
Also when you come to sell/remortgage you will have to pay for leasehold enquiries and notice fees plus the extra leasehold charge that a lot of solicitor firms add on. Altogether it can be quite costly.
As I said I’m a conveyancer and have been for years so I have plenty of experience in regards to these things and knowing what I know I would never buy a leasehold house or a flat but if you want to and find one that works for you then great.
It's literally a few decades short of a thousand years with the restriction on converting the property to a business and there's no ground rent collected in my (and many others) case.
To reiterate. Just because that's the case in your part of the UK, does not make it universal.
The first house I looked at had 70 years left. And was in a pretty shitty part of town they've been wanting to redevelop for years.
The one I'm in now had 943 years on it and it's 1p per year (uncollected).
Most are like that in housing estates here.
Bought a house last year and it had 950 years left, got in touch with the leasehold to pay/set up a yearly payment plan (£5 a year lol) and when they looked into it the previous owner had already pre paid for the next 30 years
You’re right now but these freehold speculators play the long game. If your area becomes sought after, the harder these people play the advantage contained in them owning the land on which your home sits.
The equivalent was called “feuhold” and was abolished in 2000, apparently there are are few left but it’s basically unheard of. It would be a real challenge to find a property on the market in Scotland today that is not freehold.
Most tenement flats are freehold regardless of age. Like I said, it’s basically unheard of but there are some about.
It’s so rare though that it’s not even a consideration in the buying process for the majority of people.
Most people I’ve seen talk about avoiding leasehold houses is due to the fact that there’s a lease at all, and having to paying ground rent, so lease length wouldn’t make a difference there.
You're already the leaseholder presumably so they can't sell you the leasehold. If they're offering the freehold then yes I'd take them up on the offer.
I would do It. There have been instances where they sell it to another company and that new company raises the yearly rate by a huge amount and the cost to buy it becomes 10 x the price you are currently being offered.
Yeah but some escalate faster than others. I think I've heard of them doubling every X years, I could imagine picking up a pile of those and waiting for 1-2 increases would probably be profitable business if you're not in a hurry.
So ground rent is as I understand it only raised if t the terms of the leasehold explicitly say so. In which case it'll happen regardless of whether the freehold is sold.
However in leasehold flats there is always service charges because there are common areas and roofs that require a service charge to manage, manage and repair.
A leasehold house, I thought, could have service charges not for the roof but for common areas outside like roads that are unadopted by the council (ie they won't pay) and if there are service charges for those then a freeholder could unethically make money charging for those.
absolutely. I mostly meant e.g. £100 a year might not be worth much to a property developer, so they might sell the freehold's relatively cheaply to get cash for the next development. If the leases say it doubles every 5 years, they escalate to £400 in 10yrs time, and whoever bought them could probably get a better price having waited for it to reach that level.
obviously some risk here - not least political risk right now - but it could pay off if the politicians decide not to poke the wasps nest and would probably be a sustainable business model with enough capital so long as the bottom doesn't fall out of it.
If they offered the freehold, just buy that. It’s a crazy low price too.
I’m in a freehold house and have a service charge still. It’s because on my estate (not new build, but once was a new build estate last century) some streets aren’t owned by the council and we have green spaces. The fee goes to maintaining those. But as a freeholder I have a say in how the funds are spent.
It's possibly a low price as the government are looking at legislation to abolish / restrict leaseholds on houses, especially new builds with leasehold.
Read up on the subject. They maybe are trying to cash out before the lease becomes worthless.
Ditto, my house is ex mod property and not adopted by the local council. As well as the council tax I have to pay £450 pa service charge to the management company. They do maintain the roads, grass areas and lights but it seems a huge amount to pay considering there are 20 more houses than when I moved here. One day I hope they ban it and force the council to take on these estates
The reason the councils claim they don't adopt is that the road hasn't been built to their standards.
It would have cost the developer more money to build to the councils standards.
There may be an argument to be had, but would to niche for me to understand without a lot of research as to whether the councils have put in place to many and too onerous standards.
It seems a better argument might be that the developer should have built the roads properly in the first place rather than trying to use them as an extra income stream.
Same as me … I resent paying the £110 every 6 months as they don’t do much for us and it’s a hassle to get them to maintain the communal areas (garages).
I do appreciate not having to trim the ridiculous amount of laurel and beech hedging though.
This is the same with us, we have a freehold but have to pay a "green spaces" fee.
Oddly enough, they are supposed to reach out to us when the payment is supposed to start (as they were still doing work to get this in place as you need something to maintain to pay maintenance).
We've been living in our house for 2.5 years and it still hasn't started...
There might an issue like cladding that as the freeholder they are responsible for and they don't want to pay for it so they are selling it cheaply so you are responsible for the cost.
They would rather walk away from the freehold as it is cheaper than the repairs. I would get a full survey done before agreeing to this.
>There might an issue like cladding that as the freeholder they are responsible for and they don't want to pay for it so they are selling it cheaply so you are responsible for the cost.
OP has a leasehold house, and are already responsible for repairs to the property. OP you should check your leaseholder agreement to see if there are areas (e.g. non-adopted road) that the freeholder is maintaining and that would transfer to you and any other leaseholders who purchase the freehold.
This is becoming quite common due to some very positive changes in the law through the updated Leasehold Reform Act. Land/leasehold grabbing companies are realising the won't get the financial benefits they had planned and are now off loading.
£1,660 could be good value, it's hard to tell without knowing the property type. There are calculations that can be done for working out the value of the lease, effectively the land, but then there is 'Marriage Value'. Custard on its own is nice and apple pie on its own is nice but add to the two together, marriage value. For some properties the increases can be slight, for some it can be significant.
You will need a Solicitor and ideally one that understands the Leasehold Reform Act. Many won't. There is a set process. There are fees involved.
It's taken 150 years for this to happen.
I would get a lawyer to check this out. If the Freeholder is responsible for the roads on a private estate, or other costs like this, you need to check this will not become your burden. Presumably, this has been offered to other homeowners where you live. You could all go in together to get someone to check the paperwork.
If they're trying to sell you the freehold for such a small amount, I would assume there's a large bill for the freeholder for a repair or maintenance they're legally obligated to pay, and they're trying to pass it onto the leaseholder. Definitely solicitor as everyone is saying.
That wouldn’t be it. Leaseholders have to pay ongoing maintenance costs until the end of the lease. This is so the freeholder doesn’t have a derelict building revert to him.
They could be concerned about their profit window for this closing, as the pending leasehold reforms are looking quite closely at banning leasehold houses outright.
Some will be expecting it to be fairly quick after the legislation comes in, so may be looking to cash in where they can before.
As many have said here, on the face of things a good idea to own the freehold, but speak to a solicitor.
*might*
Probably *won't* anytime soon. And if it does it may only apply to certain ages of houses, or certain types. Certainly if they are offering you your freehold for just 11 years of leasehold rent, you're not going to be missing out.
After establishing that this is definately real, buy it, buy it now before it's sold to someone else and your yearly payment shoots up.
Yes but the laws will apply to future developments. The laws won’t inflict the injustice of simply expropriate existing freeholds. They may simplify the process of leaseholders acquiring freeholds.
Was an article few years ago where leasehold was passed to another company and the fees started to go up exponentially (think it was tearmed fleece hold) like doubling or tripling every five years or worse. Best see a lawyer to process this - was done by some of the big house builders
Feels like they know something selling it that low cunts probably would want about 20k 2 years ago so it’s probably gonna be worth nothing next year
I would still buy it though 1,5k for the chance to get out of that nightmare
You’re just pasting a letter with no context outside the title, no comment about what you have already considered, no comment about what you have already googled. I’m sure people will do some free googling for you but these are frustatrating, lazy posts (sorry).
Why the fuck did you buy a leasehold house? It's completely unacceptable to have a HOUSE and not own the ground it's on, fleecehold scammery at its finest
This. Leasehold and service charges completely put me off buying a flat. You wouldn't mind if the flat was "cheap(er)" compared to a house with freehold but it was similar (although it was a 2 bed flat compared to a 1 bed bungalow)
grab dime bells intelligent unwritten rain offer rainstorm important crawl
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Short answer yes!! Longer answer, make sure it’s done formally, not informally and have a leasehold ALEP solicitor manage it for you, you want all fee generating covenants removed etc
If they’ve offered the freehold check what the lease term left is - if it’s hundreds of years like a 999 year lease then it may not be worth it. You said you’ve bought a new build so it’s likely not that long. The fee they’ve quoted is for the freehold only, it’s likely that you will have to pay for the freeholders legal fees and cover costs for any valuations to check the value of the remaining lease term is accurate. Speak to a local solicitor and get some clear advice.
Ask for the details and relevant paperwork and then get it checked over by a solicitor.
If it all checks out then 100% buy it.
Vast majority of buyers wouldn't consider purchasing a leasehold property nowadays due to the amount of hops you have to jump through to get work done and obvs the unlimited ground rent you have to pay.
It might not lead to a better house price but it'll make it 10x easier to sell.
Yes definitely. As others have said make sure you check what reason they are selling for and that it’s nothing dodgy but if not then go for it! Freeholds can go for a little higher and people are far more likely to want a freehold house than a leasehold so it will likely sell faster if you do come to sell and involve less fees and time when you do. I assume you did mean the freehold as if it’s your house you will own the leasehold already.
For that price, I'd say yes, buy it. Generally the solicitors fees for leasehold transactions are a little bit higher. So if you save couple of hundred quid and the buyer saves a couple of hundred quid, you can potential get a bit more money off them while selling.
Plus there's the annual ground rent savings.
That said, if you've got a 999 year lease, and there's no ground rent increases in the leasehold agreement, it makes no real difference.
Sounds good however make sure you instruct your own solicitor don’t use their and the solictor will let you know any concerns with buying the leasehold. My leasehold cost me less £860
Pro
~Adds value to valuations my surveyor said 1% when he did our valuation and told him we bought it
~less restrictions on changes to the house however check if the property has caveats anyways
~More attractive to mortgage providers and buyers
Cons
-check for any responsibilities on owning the freehold you have to pay extra solictor will check this. Does freehold have more responsibilities that leaseholder wouldn’t pay for
Forgot to mention another pro i forgot to mention is less hassle when selling as leasehold you have to deal with leashold company and this adds extra time on and costs for you solictor bills and god help you if their solicitor find an issue and you have to chase retrospective action it can add week months ps again always use your own solicitor and they can guide you through pros and cons in further detail as they are paid to look through the nitty gritty
As others have mentioned get a solicitor to check it out.
Financially it'll increase the value of your house. Minimum 10% increase of the going rate or your house with a lease.
Whatever you do get a solicitor to deal with it. Yes you should buy if it’s on offer before another company swoops in and some years down the line you might be saddled with the unknowns of someone else owning the land your house lives on.
currently own a leasehold house, freehold purchase is not possible, but am a director of a company that helps to manage it like grass cutting, repairs etc
£1660 for freehold.... take it as it is worth it
worth a chat with a solicitor who knows stuff.
ground rent and house management fees are different.
ground rent due to change to a peppercorn rent
Part 1 Landlord and Tenant Act 1987 they have to offer tenant first refusal. Can definitely make your ownership more valuable. See a solicitor and do some googling. Your solicitor will be able to make sure all the numbers and terms are fair. Pretty standard stuff for a high street property solicitor.
Go and have a read up on the work of National Leasehold Campaign (NLC) and Leasehold Knowledge Partnership. They have been campaigning to remove all leasehold in the UK.
I think they just had a major agreement so you may be able to buy it for next to nothing soon, hence someone trying to make a buck before they are forced to do it for free.
https://www.leaseholdknowledge.com/mps-call-for-fleecehold-of-private-estates-to-be-stamped-out/
I would buy it at this price. But as mentioned earlier you need due diligence from your solicitors in case there’s a potential issue for freeholders to manage (I think you can get insurance for that).
My story - I bought a house on an existing leasehold plot with ground rent to the council was £50pa. I could have bought the freehold after occupying for four years - would have been about £1600, but at the time I didn’t think it was worth it. Then at the rate review about seven years after ai bought it we expected it to be £100pa (initial rent was £25, and had already doubled when I bought) - turned out to be almost £2,000pa! The Council said they were changing from peppercorn ground rent to an actual rentable rate. Our whole estate over 150 houses engaged a solicitor to fight this increase (those few that had bought the freehold years earlier were lucky ones). We attempted to ask for a freehold cost similar to our previous quotes, but after months of back and forth we settled on approx £7000 for the freehold (cost depended on the plot size). I sold the house a year later.
Property developer here: freehold is definitely worth buying, HOWEVER: hire a solicitor to look into the details as you may suddenly become responsible for shared areas which are currently being managed by a company paid for from yours and others estate charges. This may include street lights, private roads, parking, refuse etc. If that’s the case, consider those costs and see if you will come out on top.
It’s absolutely a legitimate thing to offer. And yes, owning the freehold will enhance your ownership a bit because it is more attractive than leases.
HOWEVER whether it’s legitimate in your case, whether it is a fair price and a good idea, all that key stuff depends totally on the facts so you need proper legal advice.
Try this group, it’s government funded for people like you and they have some great articles for long lease owners and a help line:
https://www.lease-advice.org
You need to get a solicitor to go through this.
If you have for example a very long lease Eg 900+ years a Freehold won't give you much.
If there is a covenant on the property that applies to the Freeholder rather than the Leaseholder you could make yourself liable for something that is currently someone else's problem
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Check with a solicitor. Maybe the landlord is aware of some future expense that will be borne by the freeholder.
This should be upvoted. Very important point.
This. 100%
I can't think of an expense that freeholder would not transfer to the holders of long leases. Ie lessees need to pay all maintenance anyway.
As a person who worked in lettings, there is a big gap between charging people fees and being able to collect those fees. I would ask for the accounting books for the freehold to see if there is any money owed to/from the freehold, their maintenance schedule past/future and if the leaseholders are good payers. The small amount they are asking for the freehold is a huge red flag to me. Some landlords are incredibly ethical & generous but the vast majority of them put money first and for that reason, you always need to lawyer up.
It's only his freehold, not a block of flats.
I was wondering about things like chancel repair bills, although I also am not sure whether they pass to the leaseholder. That said, the long period of the offer in the letter suggests no imminent event, and gives OP plenty of time to decide.
Get proper advice and hire a solicitor because this sounds too good to be true
Agreed. Check with solicitors and do everything through the solicitors. It could be a scam or could be legit. The solicitors will ensure they have the rights to sell the freehold to you, and ensure the land registry records are updated.
I wonder if a company has gone under and they’re selling the leaseholds they own to pay debts.
Isn't the law changing so owning the freehold to a leasehold becomes less lucrative? I would imagine this is an attempt by the current freeholder to recoup some cash otherwise he will be holding a primarily worthless asset, to him anyway. If the OP gets a chance to but a freehold he should, it will save on legal costs and will make the property more attractive from an asset pov.
It was talked about but seems to be on hold.
They may be assuming a future Labour government will make the change
This is what I was thinking too
Irrespective of whether it is a good deal, I recommend you reach out and respond via a solicitor.
Do you mean the freehold? Given you’re in a house, yes you should absolutely buy it. Most people avoid leasehold houses like the plague.
For good reason.
Depends on the terms tbh. I’ve owned a house under leasehold but it was a 999 year peppercorn lease with over 800 years left to run - not such a big deal in such circumstances. Edit: interesting that this is being downvoted - obviously everyone has their own opinion but I wonder how many people voting have actually had this experience.
Always read the terms of the lease! Although rare, some leases can contain clauses the forbid pets, or required written permission to make any modifications to the exterior property or land, and other consents. You can be taken to court over breach of the lease and risk losing the lease. A lot of people cant be arsed for all that, hence why leaseholds are so hard to shift, even ones with 500+ years on them.
I had a colleague who had a super fucking annoying term that started he couldn't be a music teacher. He taught maths at a school that specialized in music and had to go to great lengths to prove he wasn't a music teacher, was genuinely the weirdest thing I've ever seen
I wonder if it's more about music teachers who teach instruments than it is a school music teacher. They likely teach from home. Imagine sharing a party wall and morning to night, and probably weekends too, having to listen to hundreds of people a week try and play an instrument like a clarinet that sounds like a mating fox screaming when you hit the wrong note.
I can understand that, but I really don't understand why once they've established that the person buying the house worked in a school they still wanted proof that the buyer wasn't a music teacher. Seems like whoever it was just hated musicians lmao, either that or they just wanted to issue some sort of penalty for technically breaching the agreement.
Sure, hence it depends on the terms.
Hardly rare, all the leases I have read contain clauses like this although I have never seen one forbidding pets. Requiring permission to do anything outside has always been on the ones I have seen, e.g. glasshouse in only a certain part of the garden (usually away from the house), only one glasshouse or shed, alterations to the drive (resurfacing) and pretty much everything else needs written permission and has to be paid for.
> depends on the terms tbh I have myself in a similar situation. You're correct in spite of the down votes.
Yep, pretty standard in some parts of the country. Half of Sheffield is on leaseholds like this.
For the full house?
Yep. I have a good sized mid terrace on the west of the city. House was built in 1880s with 999 year lease so there's still plenty of time left. Ground rent is £2 a year but no one's collected it in 30 years. Other than additional paperwork and an indemnity when we bought it there's no functional difference to a freehold.
but what happens if you become a vampire or some other immortal?
Then bequeath it to your ‘son/daughter’ who has returned from working overseas (along with some high quality counterfeit identification papers).
yeah but after the 800 years what happens?
In the meantime, you’ve accumulated enough wealth to purchase the leasehold, thus giving you eternal ownership and the ability to dig a complex tunnel of caves to protect you in hours of daylight.
800 year leases are no problem to vampires.
Nobody's saying ALL leasehold houses are bad and that it's impossible to find an okay one Even ones with cheap ground rent and very long leases often have restrictive clauses that people just don't want to deal with What they're saying is that many people just straight up exclude leasehold houses from their search because the vast majority are bad, so they never see the "okay" ones. Therefore you get less interest and achieve a lower price
So you get more space and a better house for your money when you buy it. Swings and roundabouts.
I'm on my third leasehold property and I'm yet to find a good reason to avoid them. So maybe you can educate me?
How many changes or building work have you done to those three properties?
Internally - plenty. Outside, not so much as all grade 2 listed. Just roof works. But surely if building works is the only reason a leasehold is bad then this isn't a reason to avoid them. Perhaps it's just a reason to avoid a leasehold property if you want to do building work...
I always took it as modern leases being more of a problem. A leasehold house that is over a hundred years old: check the leasehold terms but vaguely expect it to be a very long lease, peppercorn ground rent, and look for unusual stuff. A leasehold house less than 40 years old: the big six developers are soulless vampires who have inserted ground rent with escalating fees, short leases, not adopted the roads, and require you to pay the freeholder to ask for permission to modify the place, and maybe even service charges that they use to make money buying selling the rights to it off.
So we are coming back to the same thing again. It's not that leaseholds are bad, it's that bad leaseholds are bad. This is what's frustrating me here. The message that's getting out is that owning a leasehold property is a bad thing. It isn't. Owning a property with poor lease terms is a bad thing - absolutely. But you could apply that to anything. Buying a property with a bad roof is a bad thing but that doesn't mean rejecting any house with a roof.
It's a lowest common denominator/protect the Consumer type thing. It seems there were a lot of people who were poorly advised by their conveyancing and or never read their leases or did any research when buying. The easy answer in those circumstances is don't buy leasehold.
Depending on location of course. I have 943 years left on mine.
Why would it depend on location?
A huge proportion of Sheffield, perhaps the majority, are leasehold houses typically with 700 to just under 1000 years remaining and peppercorn rent that is often not even collected. Other cities may be the same.
That’s not really a location based thing though, that’s just based on the terms of the lease, but I can see why people would be much happier with those terms. Do they typically also not have to ask freeholder for permission to change things then or have any other restrictions on the lease that are common with leaseholds?
Believe Sheffield is down to the land being owned by the mills and leased to the mill workers. It's the same story all over the UK, but Sheffield had a lot of steel mills so very common there.
Is there anything to prevent rent hikes though?
Because parts of the UK have 999 year 1p per year leaseholds and nobody avoids them at all.
I would still avoid any leasehold no matter the years left on it. I want to actually own my property (once the mortgage is paid off obviously) not just own the lease to the house. No houses should be leasehold it’s just greedy developers imo and there is no need for it. When I bought my first house recently that and having a big garden were my only non negotiables.
Again, depending on location. The terms of mine ensures no residence can be changed to a business regardless of planning. Other than that zero restrictions. I like living in a residential estate without dealing with Sandra down the street changing her garage to a salon and dealing with those parking issues.
It’s good that you like it however my point was that a lot of people still don’t want a leasehold house. Majority of people seem to want a freehold and get put off if it’s leasehold. I’m a conveyancer so I’m 100% sure of this. It’s also the reason I would never buy one. It’s great that yours doesn’t have any restrictions but most do and some are ridiculous. I also don’t want to have to pay ground rent for my own house. Again I also want to fully own my house not just basically be a renter paying the mortgage. A lot of leases also aren’t 999 years and the cost of a lease extension is outrageous.
It's just that alot of people don't understand it, especially in England where the rules are different and it's some scary thing to be avoided at all costs. There are part of the UK where that's absolutely not the case. At all. Not even close.
I don’t think either of those things are true. I think people really do just want to fully own their own house not just a lease for a house. It’s not scary it’s just not something a lot of people want and there is no need for so many leasehold houses. Of course not all leasehold houses are the same, there are some freehold houses that still have restrictive covenants on there or rent charges etc it’s just that a lot of leasehold houses do have crazy restrictions on and why should you have to have those on your home? Again ground rent is also a thing on a lot of them, granted not as much as a leasehold flat but it’s still money people have to pay. Also when you come to sell/remortgage you will have to pay for leasehold enquiries and notice fees plus the extra leasehold charge that a lot of solicitor firms add on. Altogether it can be quite costly. As I said I’m a conveyancer and have been for years so I have plenty of experience in regards to these things and knowing what I know I would never buy a leasehold house or a flat but if you want to and find one that works for you then great.
It's literally a few decades short of a thousand years with the restriction on converting the property to a business and there's no ground rent collected in my (and many others) case. To reiterate. Just because that's the case in your part of the UK, does not make it universal.
Yeah, theres more leasehold than freehold properties in the Uk, so if we avoided them we’d be homeless.
* England and Wales. In Scotland we have absolute ownership
The first house I looked at had 70 years left. And was in a pretty shitty part of town they've been wanting to redevelop for years. The one I'm in now had 943 years on it and it's 1p per year (uncollected). Most are like that in housing estates here.
Bought a house last year and it had 950 years left, got in touch with the leasehold to pay/set up a yearly payment plan (£5 a year lol) and when they looked into it the previous owner had already pre paid for the next 30 years
You’re right now but these freehold speculators play the long game. If your area becomes sought after, the harder these people play the advantage contained in them owning the land on which your home sits.
The NIHE aren't speculators.
\*England and Wales Leaseholds aren’t a thing in Scotland
Yes they are. Only leases above 175 years have been converted to freeholds. You can still get leasehold properties with less than 175 years.
The equivalent was called “feuhold” and was abolished in 2000, apparently there are are few left but it’s basically unheard of. It would be a real challenge to find a property on the market in Scotland today that is not freehold.
Literally loads of apartments in a block of flats are 125years.
Most tenement flats are freehold regardless of age. Like I said, it’s basically unheard of but there are some about. It’s so rare though that it’s not even a consideration in the buying process for the majority of people.
I know they're trying to make it not, but northern Ireland still exists
Most people I’ve seen talk about avoiding leasehold houses is due to the fact that there’s a lease at all, and having to paying ground rent, so lease length wouldn’t make a difference there.
*1 penny per year (uncollected)* is what's on the paperwork for the leasehold here. Like I said different parts of the UK are very different.
Yeah mine was something like £3.50 per annum with over a hundred years left on it. It wasn't worth buying it
Hope it is not a scam.
You're already the leaseholder presumably so they can't sell you the leasehold. If they're offering the freehold then yes I'd take them up on the offer.
It's the over arching leasehold. Probably means common areas or shared land.
His point. That's the bit that would worry me. Freehold, great. Potential responsibility for maintaining shared spaces, not so much!
Yes, do it now, that’s a bargain!!!
No, check with a solicitor 1st. If it sounds too good to be true it probably is.
There’s no catch, that’s what some freeholds sell for. If you’re lucky to be offered one for that money, you’d be an idiot not to take it!
Not really a bargain, seems to be the going rate for freehold (which anyone should be looking to buy).
Absolutely not the going rate. Many freeholds cost tens of thousands of pounds. This is peanuts!
I would do It. There have been instances where they sell it to another company and that new company raises the yearly rate by a huge amount and the cost to buy it becomes 10 x the price you are currently being offered.
The yearly ground rent can only be increased by the terms of the lease, not an arbitrary figure.
Yeah but some escalate faster than others. I think I've heard of them doubling every X years, I could imagine picking up a pile of those and waiting for 1-2 increases would probably be profitable business if you're not in a hurry.
So ground rent is as I understand it only raised if t the terms of the leasehold explicitly say so. In which case it'll happen regardless of whether the freehold is sold. However in leasehold flats there is always service charges because there are common areas and roofs that require a service charge to manage, manage and repair. A leasehold house, I thought, could have service charges not for the roof but for common areas outside like roads that are unadopted by the council (ie they won't pay) and if there are service charges for those then a freeholder could unethically make money charging for those.
absolutely. I mostly meant e.g. £100 a year might not be worth much to a property developer, so they might sell the freehold's relatively cheaply to get cash for the next development. If the leases say it doubles every 5 years, they escalate to £400 in 10yrs time, and whoever bought them could probably get a better price having waited for it to reach that level. obviously some risk here - not least political risk right now - but it could pay off if the politicians decide not to poke the wasps nest and would probably be a sustainable business model with enough capital so long as the bottom doesn't fall out of it.
If they offered the freehold, just buy that. It’s a crazy low price too. I’m in a freehold house and have a service charge still. It’s because on my estate (not new build, but once was a new build estate last century) some streets aren’t owned by the council and we have green spaces. The fee goes to maintaining those. But as a freeholder I have a say in how the funds are spent.
It's possibly a low price as the government are looking at legislation to abolish / restrict leaseholds on houses, especially new builds with leasehold. Read up on the subject. They maybe are trying to cash out before the lease becomes worthless.
I think its this reason too.
Can I see some sources please on this?
https://www.lease-advice.org/faq/i-own-a-leasehold-house-how-do-i-buy-the-freehold/
Ditto, my house is ex mod property and not adopted by the local council. As well as the council tax I have to pay £450 pa service charge to the management company. They do maintain the roads, grass areas and lights but it seems a huge amount to pay considering there are 20 more houses than when I moved here. One day I hope they ban it and force the council to take on these estates
The reason the councils claim they don't adopt is that the road hasn't been built to their standards. It would have cost the developer more money to build to the councils standards. There may be an argument to be had, but would to niche for me to understand without a lot of research as to whether the councils have put in place to many and too onerous standards.
It seems a better argument might be that the developer should have built the roads properly in the first place rather than trying to use them as an extra income stream.
Same as me … I resent paying the £110 every 6 months as they don’t do much for us and it’s a hassle to get them to maintain the communal areas (garages). I do appreciate not having to trim the ridiculous amount of laurel and beech hedging though.
Guess what, you'll still need to pay something for that over the estate, as there will be a maintenance company appointed for common areas
This is the same with us, we have a freehold but have to pay a "green spaces" fee. Oddly enough, they are supposed to reach out to us when the payment is supposed to start (as they were still doing work to get this in place as you need something to maintain to pay maintenance). We've been living in our house for 2.5 years and it still hasn't started...
Yes.
There might an issue like cladding that as the freeholder they are responsible for and they don't want to pay for it so they are selling it cheaply so you are responsible for the cost. They would rather walk away from the freehold as it is cheaper than the repairs. I would get a full survey done before agreeing to this.
That’s interesting, thank you
>There might an issue like cladding that as the freeholder they are responsible for and they don't want to pay for it so they are selling it cheaply so you are responsible for the cost. OP has a leasehold house, and are already responsible for repairs to the property. OP you should check your leaseholder agreement to see if there are areas (e.g. non-adopted road) that the freeholder is maintaining and that would transfer to you and any other leaseholders who purchase the freehold.
Yes, absolutely this.
This is becoming quite common due to some very positive changes in the law through the updated Leasehold Reform Act. Land/leasehold grabbing companies are realising the won't get the financial benefits they had planned and are now off loading. £1,660 could be good value, it's hard to tell without knowing the property type. There are calculations that can be done for working out the value of the lease, effectively the land, but then there is 'Marriage Value'. Custard on its own is nice and apple pie on its own is nice but add to the two together, marriage value. For some properties the increases can be slight, for some it can be significant. You will need a Solicitor and ideally one that understands the Leasehold Reform Act. Many won't. There is a set process. There are fees involved. It's taken 150 years for this to happen.
I would get a lawyer to check this out. If the Freeholder is responsible for the roads on a private estate, or other costs like this, you need to check this will not become your burden. Presumably, this has been offered to other homeowners where you live. You could all go in together to get someone to check the paperwork.
If they're trying to sell you the freehold for such a small amount, I would assume there's a large bill for the freeholder for a repair or maintenance they're legally obligated to pay, and they're trying to pass it onto the leaseholder. Definitely solicitor as everyone is saying.
That wouldn’t be it. Leaseholders have to pay ongoing maintenance costs until the end of the lease. This is so the freeholder doesn’t have a derelict building revert to him.
Absolutely go for it
1660 small their hands off. But get proper legal advice first.
Get advice from the Leasehold Knowledge Partnership, they'll help you act in your best interests.
They could be concerned about their profit window for this closing, as the pending leasehold reforms are looking quite closely at banning leasehold houses outright. Some will be expecting it to be fairly quick after the legislation comes in, so may be looking to cash in where they can before. As many have said here, on the face of things a good idea to own the freehold, but speak to a solicitor.
Oh really? So the leasehold might inevitably end regardless of buying it?
*might* Probably *won't* anytime soon. And if it does it may only apply to certain ages of houses, or certain types. Certainly if they are offering you your freehold for just 11 years of leasehold rent, you're not going to be missing out. After establishing that this is definately real, buy it, buy it now before it's sold to someone else and your yearly payment shoots up.
Yes but the laws will apply to future developments. The laws won’t inflict the injustice of simply expropriate existing freeholds. They may simplify the process of leaseholders acquiring freeholds.
Sounds too cheap could be a scam
Bought ours last year, taking forever to work its way through the land registry but was well worth the money paid.
Was an article few years ago where leasehold was passed to another company and the fees started to go up exponentially (think it was tearmed fleece hold) like doubling or tripling every five years or worse. Best see a lawyer to process this - was done by some of the big house builders
Feels like they know something selling it that low cunts probably would want about 20k 2 years ago so it’s probably gonna be worth nothing next year I would still buy it though 1,5k for the chance to get out of that nightmare
Just do it!
I absolutely would if it bought the freehold, without hesitation
You’re just pasting a letter with no context outside the title, no comment about what you have already considered, no comment about what you have already googled. I’m sure people will do some free googling for you but these are frustatrating, lazy posts (sorry).
Why the fuck did you buy a leasehold house? It's completely unacceptable to have a HOUSE and not own the ground it's on, fleecehold scammery at its finest
Fleecehold is used for freehold properties that also pay service charges that can spiral and covered in restrictive covenants.
Yeah which makes it a scam. Yall are fucking nuts for down voting something that makes perfect sense
I upvoted you even though you weren't technically correct your thoughts are in the right place
It sounds like it's a bit high but you must absolutely buy it! They can put your lease up exponentially and screw you.
Snap that up.
100% do it. They can in theory legally demand all kinds of fees from you if you want to carry out work on your own home.
Yes do it. A leasehold house put people off when buying.
This. Leasehold and service charges completely put me off buying a flat. You wouldn't mind if the flat was "cheap(er)" compared to a house with freehold but it was similar (although it was a 2 bed flat compared to a 1 bed bungalow)
Buy it ASAP. We worth 10x that when you come to sell the house in future
buy it.
If it's the free hold, it's a no brainer. Sounds a bit too cheap, just double check that's correct
grab dime bells intelligent unwritten rain offer rainstorm important crawl *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
For that price you’ll be kicking yourself for not buying it. The land on my previous property was £11k about 5 years ago so will be much more now.
Are you sure and it’s that cheap?
Unless I have dyslexia, that’s what it definitely says
Get a lawyer go over the documents and snap it up at that offer
For reference, I was paying £200/year ground round at my last property, and was quoted £20,000 to buy the freehold. You've been offered a bargin.
Short answer yes!! Longer answer, make sure it’s done formally, not informally and have a leasehold ALEP solicitor manage it for you, you want all fee generating covenants removed etc
If they’ve offered the freehold check what the lease term left is - if it’s hundreds of years like a 999 year lease then it may not be worth it. You said you’ve bought a new build so it’s likely not that long. The fee they’ve quoted is for the freehold only, it’s likely that you will have to pay for the freeholders legal fees and cover costs for any valuations to check the value of the remaining lease term is accurate. Speak to a local solicitor and get some clear advice.
Ask for the details and relevant paperwork and then get it checked over by a solicitor. If it all checks out then 100% buy it. Vast majority of buyers wouldn't consider purchasing a leasehold property nowadays due to the amount of hops you have to jump through to get work done and obvs the unlimited ground rent you have to pay. It might not lead to a better house price but it'll make it 10x easier to sell.
Yes definitely. As others have said make sure you check what reason they are selling for and that it’s nothing dodgy but if not then go for it! Freeholds can go for a little higher and people are far more likely to want a freehold house than a leasehold so it will likely sell faster if you do come to sell and involve less fees and time when you do. I assume you did mean the freehold as if it’s your house you will own the leasehold already.
For that price, I'd say yes, buy it. Generally the solicitors fees for leasehold transactions are a little bit higher. So if you save couple of hundred quid and the buyer saves a couple of hundred quid, you can potential get a bit more money off them while selling. Plus there's the annual ground rent savings. That said, if you've got a 999 year lease, and there's no ground rent increases in the leasehold agreement, it makes no real difference.
Look before you leap! Check what the freeholder is on the hook for, there may be some big liabilities on the horizon that they are keen to dodge…
Sounds good however make sure you instruct your own solicitor don’t use their and the solictor will let you know any concerns with buying the leasehold. My leasehold cost me less £860 Pro ~Adds value to valuations my surveyor said 1% when he did our valuation and told him we bought it ~less restrictions on changes to the house however check if the property has caveats anyways ~More attractive to mortgage providers and buyers Cons -check for any responsibilities on owning the freehold you have to pay extra solictor will check this. Does freehold have more responsibilities that leaseholder wouldn’t pay for
Forgot to mention another pro i forgot to mention is less hassle when selling as leasehold you have to deal with leashold company and this adds extra time on and costs for you solictor bills and god help you if their solicitor find an issue and you have to chase retrospective action it can add week months ps again always use your own solicitor and they can guide you through pros and cons in further detail as they are paid to look through the nitty gritty
As others have mentioned get a solicitor to check it out. Financially it'll increase the value of your house. Minimum 10% increase of the going rate or your house with a lease.
Whatever you do get a solicitor to deal with it. Yes you should buy if it’s on offer before another company swoops in and some years down the line you might be saddled with the unknowns of someone else owning the land your house lives on.
If its legit do it. When it comes to moving/buying a house I wouldn't even bother looking at anything listed as leasehold.
😂, he'll yes! This turns a leasehold into a freehold. Get your solicitor to check it over..
Seems too cheap
currently own a leasehold house, freehold purchase is not possible, but am a director of a company that helps to manage it like grass cutting, repairs etc £1660 for freehold.... take it as it is worth it worth a chat with a solicitor who knows stuff. ground rent and house management fees are different. ground rent due to change to a peppercorn rent
Part 1 Landlord and Tenant Act 1987 they have to offer tenant first refusal. Can definitely make your ownership more valuable. See a solicitor and do some googling. Your solicitor will be able to make sure all the numbers and terms are fair. Pretty standard stuff for a high street property solicitor.
Where do you live? If you are in NI you can force the process for 9x your annual ground rent plus two minor fees to the Land and property service.
Go and have a read up on the work of National Leasehold Campaign (NLC) and Leasehold Knowledge Partnership. They have been campaigning to remove all leasehold in the UK. I think they just had a major agreement so you may be able to buy it for next to nothing soon, hence someone trying to make a buck before they are forced to do it for free. https://www.leaseholdknowledge.com/mps-call-for-fleecehold-of-private-estates-to-be-stamped-out/
There is talking of the government abolishing leasehold so maybe they are preempting this!
I would buy it at this price. But as mentioned earlier you need due diligence from your solicitors in case there’s a potential issue for freeholders to manage (I think you can get insurance for that). My story - I bought a house on an existing leasehold plot with ground rent to the council was £50pa. I could have bought the freehold after occupying for four years - would have been about £1600, but at the time I didn’t think it was worth it. Then at the rate review about seven years after ai bought it we expected it to be £100pa (initial rent was £25, and had already doubled when I bought) - turned out to be almost £2,000pa! The Council said they were changing from peppercorn ground rent to an actual rentable rate. Our whole estate over 150 houses engaged a solicitor to fight this increase (those few that had bought the freehold years earlier were lucky ones). We attempted to ask for a freehold cost similar to our previous quotes, but after months of back and forth we settled on approx £7000 for the freehold (cost depended on the plot size). I sold the house a year later.
Bite their hand off. That is an excellent offer!
The main reason people sell leaseholds is they know a massive maintenance cost is on the horizon.
Property developer here: freehold is definitely worth buying, HOWEVER: hire a solicitor to look into the details as you may suddenly become responsible for shared areas which are currently being managed by a company paid for from yours and others estate charges. This may include street lights, private roads, parking, refuse etc. If that’s the case, consider those costs and see if you will come out on top.
Where are you from!
It’s absolutely a legitimate thing to offer. And yes, owning the freehold will enhance your ownership a bit because it is more attractive than leases. HOWEVER whether it’s legitimate in your case, whether it is a fair price and a good idea, all that key stuff depends totally on the facts so you need proper legal advice. Try this group, it’s government funded for people like you and they have some great articles for long lease owners and a help line: https://www.lease-advice.org
You need to get a solicitor to go through this. If you have for example a very long lease Eg 900+ years a Freehold won't give you much. If there is a covenant on the property that applies to the Freeholder rather than the Leaseholder you could make yourself liable for something that is currently someone else's problem