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99 year lease, 4 years left


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We bought a property in 2008 and pay around £13 ground rent to the council. At the time our solicitor said our property was on a 99 year leasehold with 8 years left; he could organise the buying of the 'freehold' I think but it was relatively easy and we could do it ourselves as he would charge.

 

I rang the council who confirmed there were 8 years left and they just needed 8 x £13 plus admin charge to do it.

 

What are the advantages of buying it and what happens if we do nothing? many thanks

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If you have the chance of the freehold for very little outlay take it, freehold is easier to sell than leasehold properties, also if you dont buy the freehold then a new lease will have to be agreed and it could cost you more, I would go for it.

If I have been of any help, please click on my star and let me know, thank you.

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I don't really know much about property law, but I guess if you don't buy the freehold once the 99 year leasehold is up one of three things could possibly happen:-

  1. you have to moved, out as ownership transfers back to the freeholder
  2. you get to carry on living there, but have to begin paying rent
  3. your asked to purchace a new 99 year leasehold

Probably best to speak to lawyer.

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  • 3 weeks later...

Hi there if I understand your first post correctly then BUY your freehold no questions asked!! it means you will own the property and the land it sits on - if you don't buy it it WILL revert to the owners of the freehold.. as pointed out in the previous post.

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Thanks Khemist, may I ask a couple of questions.. were i not to buy the freehold then...

  1. If the council already own the freehold will they potentially be able to significantly raise the Ground Rent I currently pay
  2. Do I (or the Yorkshire Building Society at the moment) still own the house, if not actually the ground it occupies; would there be a problem if we tried to sell it?

cheers

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you didnt bye the house you bought the lease when the lease ends

the house goes back to the freeholder if you can bye thefreehold

go for it you cant sell it if you dont own the free hold and the lease as run out

you dont own it

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Hi Mitch

 

Yes and yes. you own only the lease not the ground, this means when the lease is up it reverts back to the original owner - THE FREEHOLD owner...

 

greasmonkey is correct!

 

Buy the freehold - I wish I could buy my freehold at that cost - [sshhh - the council may have made a mistake - take up their offer FAST!]

 

What this effectively means is: if you tried to sell now your lease would be worthless! and will come with lots of legal complications, however if you own the freehold - especially at 8 x 13quid - you can sell for top money and its all yours...

 

khemist

Edited by khemist
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My new neighbor blocked my buying of the freehold by agreeing and purchasing a new lease for 125 years @ a cost of 17000 pounds plus legal costs - total 20.000 - WE COULD HAVE BOUGHT THE FREEHOLD FOR 1000 POUNDS - but she is single with no kids - and her words were 'I have no one to leave it to anyway!!!' - what a selfish waste - now I cannot buy it without her getting involved and she will not...

 

Now my child suffers, never mind lesson learnt...

 

BUY THE FREEHOLD!!!!!!

 

khemist

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I dont know your age your circumstance or life situations, however if I were you I would sell my car for the money and own my freehold and walk everywhere until I could buy a new car!

 

Just my own thoughts.

 

A question? is this a single dwelling house we are talking about?

 

khemist

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Ok - do not be curious - I live in an old Victorian house split into two flats a completely different situation from yours, however even more reason to BUY you have no challengers other than the council freehold ownership! moreover they have offered it to you on a plate with the best silver service and servants!!!!!!

 

khemist

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I need to thank you mitch, advising you has made me see an angle to get my freehold... cheers!

 

I hope my info helps you to make an informed decision - please remember I am not a lawyer just someone who likes to get it right - all my info is just my opinion [as if it were I!] this situation is close to home...

 

khemist

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Thanks for your last comment Mitch, I hope the comments you have received has helped you make an informed decision.... GOOD LUCK! although you wont need it!!!!!!!

 

khemist

 

ps - I will be forward thinking, LET US KNOW WHEN YOU BUY THE FREEHOLD????

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Thanks Khemist, Ive been on the council website this morning, they say I can 'buy out' my ground rent. Is this one and the same thing? see below..........

 

Ive also been on the Leasehold Advisory Service Website which says I must have lived in the property 2 years before buying freehold; I wonder how come my solicitor said I could buy it when I moved in?

 

How do I go about buying out my ground rent?

 

In certain areas the Council has already made offers to ground rent lessees, and will be continuing this scheme in other areas in the future. If you wish to buy out now you should write to the Estates and Valuation Service, Council Offices

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AND NOW THE GAMES BEGIN!

 

OK, do you have the letter from the council offering you the 8 x 13pounds request? lets not get complicated, lets look at what we have so far. the L.A.S. is a good place for info, however with the law I have definitely learnt, its not what you know, its what you can PROVE!

 

I will have to check the ground rent/freehold bit - but what I know is the freehold owner can charge rent on the ground it owns, so in theory ground rent/freehold may be the same in their eyes..

The law will be specific on these matters, I will check for you.

 

khemist

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Sorry Khemist it was done over the phone and I think ( bear in mind 4 years ago) it was the basic calculation of £16* x 8 = £128.00

*(sorry not £13 pa it is £16 paid in 2 x 6 monthly installments of £8).

 

I will call them now to double check and give you update

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Update: response from council makes me look foolish; apparently there is 59 years left on lease, house was built 1972 and the 99 years begins from that date. Here is their response below but I have one last question:

 

If I buy the freehold and eventually sell the house can I either a) charge ground rent or b) sell the Freehold as a separate transaction

 

are there disadvantages in delaying for a few years? (Dont have a grand at the mo!)

Any advice would be appreciated

 

I confirm that the Council are wiling to dispose of their freehold interest in the property.

The long leasehold interest is for a term of 99 years from 25th April 1972, i.e. expiring in 2071. There is therefore just less than 59 years remaining unexpired. The ground rent is £16.00 per annum.

If you wish to proceed with purchasing the Council’s freehold interest (i.e. effectively ‘buying out’ your ground rent) you will be required to bear our legal and surveyors’ fees of £300 and £100 respectively together with a standard charge of 25 times the annual ground. This would produce a total fee of £800.

Accordingly, I would be grateful if you could confirm whether you wish to proceed with the purchase of the Council’s freehold interest for a total fee of £800.

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Hi Mitch

 

I don't know where you live - and I understand your position - if you delay too long, prices will change! owning all the property ie ground and buildings is the best thing for anyone in your position - in your case broken down into the ground is owned by the council, you own the rights to the building by way of a lease for the next 59 years, if you own all - called freehold, you own everything and can do as you please with your property [law permitting] as it stands you will find in your lease certain clauses that say - if you want a satellite dish you must inform them first and pay a fee for a license, this is the same for window and door replacement also! its all a con.... own your whole home then this cannot happen.

If you have kids then this is where it matters most for you!

 

In 59 years time the property goes back to the ownership of the ground - the freeholder.... all your money and efforts could be swiftly taken away with no inheritance for your heirs.

If you own it all, the kids will have it as an estate to argue over [make a will!] lol, get my drift?

 

Hope this helps.

 

khemist

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