Buying a house - Leasehold & Freehold

[DimPrawn]

I thought most leaseholds were reset to 999 years at sale effectively negating any ownership issues with the leaseholder.

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Nope. Lease it whatever it is (999 years, or even 9 yrs).

It's up to you to renew the lease and the leasholder is under no obligation to renew it.

[gingerjedi]

Nope. Lease it whatever it is (999 years, or even 9 yrs).

It's up to you to renew the lease and the leasholder is under no obligation to renew it.

Is he rich... this Duke of Westminster guy?

[Moscow Mule]

Is he rich... this Duke of Westminster guy?

He's a modern day Croesus.

[TykeMerc]

Is he rich... this Duke of Westminster guy?

I think he's got a few bob.

There are a few other places with almost no freehold houses, Lytham St Annes for instance the land is almost all leasehold as the towns are built on an old estate that's retained ownership of the land in some trust.

I'm believe there are other towns like that too.

Not common of course, but there are some.

As someone said the lenders can be a bit funny about leasehold houses and freehold flats.

[centurian]

Nope. Lease it whatever it is (999 years, or even 9 yrs).

It's up to you to renew the lease and the leasholder is under no obligation to renew it.

And taking it to the larger scale, Hong Kong was leased to the UK on a 99 year lease when it was a pretty insignificant place.

Oddly enough, they decided they didn't want to extend the lease when it expired.

[OwlHoot]

And taking it to the larger scale, Hong Kong was leased to the UK on a 99 year lease when it was a pretty insignificant place.

Oddly enough, they decided they didn't want to extend the lease when it expired.

The UK would have liked to, but the Chinese were keen to get it back, to bolster their own economy.

And as practically all fresh water came from the mainland, there wasn't a lot the UK could do - If we had started "squatting" after the lease expired, the Chinese would have simply turned off the taps!

[Moscow Mule]

As someone said the lenders can be a bit funny about ...freehold flats.

It's ok if you're buying your "share" of the freehold too. Both the flats I've owned have come with a share of the freehold.

[eliquant]

If your leashold (lease) runs out i.e. 0 years left then you no longer own the building which you have paid for and worked all those years (ownership gets transferred to the person who owns the land on which your flat sits), you then become "an assured tennant" of the property that you previously owned and are liable to pay market rent on your flat in order to stay in the property.

However, you do have the option to 'extend' the lease by getting a quote from the landowner, these are often unfair and often result in lease valuation tribunials.

Another word of warning is that when it comes to negotiating the lease extension it is advantageous to have a lease on the property which is OVER 80s years because if it is less than 80 years you have to pay the difference between the value of the property were it free hold versus were it leasehold (this increases as you approach 0 years on the lease), this is known as the 'marriage value'; also you will have to pay an amount which will somehow compensate the landowner for the loss of increased "ground rent" due to the proposed lease extension, ground rent (or "pepper corn" rent) often doubles every 5 years or so (note this is NOT anything to do with the maintenence/service charge on the property).

Confused ? well I am.

Its a rip off scheme

[Moscow Mule]

Its a rip off scheme

Fairly, but if you buy leases over 150 years it's not going to be your problem...

Secondly, you're not responsible for the upkeep of the building if you don't own the freehold - the landlord is.*

*Generally applies to flats where you own the floorboards & plaster, not the bricks and mortar.

[BolshieBastard]

leasehold = someone else owns the land 'your' house or apartment sits on. As such, the landlord can stipulate certain do's and dont's over what you can do to the property.

You have the right to buy your leasehold once a year by making a market value offer to the landlord. Some landlords on housing estates may offer the chance to buy the lease once a year but this is not counted as 'your' one chance.

If you and the landlord cannot agree a sum, you can go to a tribunal who will decide on a reasonable sum. If you fail to take up this offer as stated by the tribunal, that's your chance gone for another year.

freehold = you own the land 'your' house or apartment sits on. Generally freehold applies to older properties. You may still have some restrictions on what you can and cant do on your property.

When you come to sell, the length of the leasehold remaining can have an affect on the sale price. Like for like leasehold property is always cheaper than a similar freehold. An estate agent would be able to advise the price differential on your property.

I recently bought my leasehold for about 3k and should really have done it a few years ago.