Beware the Leasehold House
You may have seen in the news that a number of buyers of new Bellway Homes have had a nasty shock when the freehold of their house was sold to an investment company, which then quoted them high premiums to buy the freehold.
Buyers of the new build properties found that although they knew their house was leasehold (meaning that they own the property for the length of their lease), they were told that they could buy the freehold (meaning that they would own the property and the land it’s built on outright) after two years for around £2,000 to £4,000.
However, when trying to buy the freehold, the buyers were informed that the developer no longer owned their freehold and they would have to purchase it from the investor.
Lucy Riley, an enfranchisement specialist at Nockolds, states that whilst owners of leasehold houses generally do have the right to buy the freehold from their landlord once they have been the tenant for the two year period, the process is complex and lengthy, and the statutory formula for valuing the price to be paid can be a minefield.
“Buyers of new properties need to be aware of the implications of buying a leasehold rather than a freehold house”, Lucy explains.
“Specialist advice is key to ensuring that the buyer budgets for the extra costs involved in buying the freehold and that they are aware of the likely effect on the value of their home as the lease term diminishes.”
“At Nockolds Solicitors, we have specialists who are able to help. We work with experienced surveyors who are able to advise on the appropriate price to pay for the freehold to help the leaseholder avoid paying more if they agree to an informal deal offered by the landlord or investor. We also ensure that the statutory process is followed properly, avoiding unnecessary costs and delays.”
For more information and to find out how we can help you, please contact Lucy Riley on 01279 755777 or email firstname.lastname@example.org