In This Guide
Before you start
Choosing an area
Homes needing work
My dream home
New homes
Offline search
Online search
Schools
Types of purchase
1. Freehold or leasehold
2. The lease
3. Leasehold costs
4. Leasehold complexities
5. Leasehold complaints
6. Shared Ownership
7. Homebuy
Viewing property
Types of purchase
Leasehold complexities
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As long as you don't start asking too many questions, the concept of leasehold property is a relatively simple one to understand. However, it's not all as straightforward as it seems...
- Under the
1993 housing act, leaseholders who meet certain conditions now
have the right to jointly buy the freehold of the entire building,
regardless of whether the landlord wishes to sell. They can
then form their own management company and maintain the building.
This right can only be exercised if all the leaseholders under
a freehold wish to buy a share in the freehold, and the landlord
can still make it pretty difficult for them to do this. The
legislation also gives leaseholders first refusal over the freehold
if the landlord wishes to sell.
- The same piece
of legislation has also made it easier for individual leaseholders
to extend the lease on their property by anything up to 90 years.
This is making it is less important if, say, you bought a lease
that had 55 years to run and have lived in a property for 30
years. Without this right you may have found it difficult to
get a good price or even a buyer for a lease with only 25 years
to run. You can extend your own lease, without having to rely
on others wishing to do the same.
- The landlord
isn't always the freeholder. There can be a chain of leases
as long as a big long chain. The original leaseholder could
have sold a lease to a developer who sold a sub-lease to a property
investment company who sold a sub-sub lease to a managing agent
who then sells a sub-sub-sub lease to the public. It can get
even longer than this too. If you find that the ground rent
is unusually high for a building, it can mean that there is
a long chain of leaseholders all connecting you to the freeholder.
- When you are buying a leasehold property, ask your solicitor to make sure that the previous holder is up to date with ground rent and maintenance payments. Sometimes any arrears are carried with the property not the leaseholder, which could mean become liable for payments the previous occupants failed to make!
Remember, property law is complex and archaic and you should always consult a qualified solicitor before making any decisions. Fortunately you can find a range of solicitors that advertise their services on the web in SiteFinder.
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