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Buying A Long Lease / Freehold In Sheffield ?

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How much should it cost to buy a freehold for a bungalow lease which started in 1959 @ £12.50 per annum for a period of 800 years? ie 800 - 60 = 740 years remaining. I know it may not add value to the property but I and my neighbours would like to have full choice for planning applications etc.

 

It appears to be financially not viable to collect the annual fee but we are concerned that there are possible implication re non payment. We are concerned that a stupid price might be quoted if we ask so a ball park figure is all for now (..... plus cost of theirs & our legal fees ?)

 

Hopefully a mutual figure could be negotiated but if not does anybody have experience of Property leasehold valuation Tribunials?

Edited by Ethermax
correct lease period

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An often quoted rule of thumb is 25-30 times the yearly ground rent. 

 

I was told that the leasehold valuation proceedings where both parties have to pay their fees (unlike a court case where you might claim fees)  are unproductive because they are many times what the lease is actually worth...it's possible the owner of the reversion knows this and will price accordingly. 

 

I can share my experience - I bought my freehold reversion a couple of years back. The holder of the fh was pretty reasonable and the reversion itself (£4 ground rent) was valued at £120. - 30 times the ground rent. 

 

However...the legal fees for me and the other party considerably more and made for the lions share of the cost.  I figured it was worth it - like you say, not necessarily to add value but to get my reversioner off my back and to ease any problems with the freehold when potentially selling in the future. 

 

Jeffrey Shaw (look for him on other threads e.g. the one on Coppen Estates) has covered this many times. 

Edited by iwbsheff

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At £12.50 a year you'd be silly not to buy IMO.

 

While it may not 'add value' to a house, what you might find when you come to sell is that prospective buyers simply will not even consider a leasehold place.

They see it's listed as leasehold on Rightmove and just close the page and look somewhere else.

 

 

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On 06/03/2020 at 13:42, geared said:

At £12.50 a year you'd be silly not to buy IMO.

 

While it may not 'add value' to a house, what you might find when you come to sell is that prospective buyers simply will not even consider a leasehold place.

They see it's listed as leasehold on Rightmove and just close the page and look somewhere else.

 

 

This rather depends on whether the purchaser currently lives in an area where leasehold houses are commonplace.

If he/she doesn't, you'd perhaps be right.

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To be fair I completely discounted all leasehold properties, even tho is common here.

Quite alot of housing stock is fairly similar, in a given area and price you'd probably find several houses for sale, similar layout and all that.

 

That means if there's something you don't like about one house, you can usually find another one round the corner thats better.

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Ethermax,

 

If there is still 740 years on the lease and paying  low ground rent , you can make a compulsory purchase  of the freehold title at 20 x the ground rent by applying to the FTT .

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On 22/10/2020 at 14:18, topflat29 said:

Ethermax,

 

If there is still 740 years on the lease and paying  low ground rent , you can make a compulsory purchase  of the freehold title at 20 x the ground rent by applying to the FTT .

Is this true.? What is FTT?  Could Jeffery advise please. 

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First Tier Tribunal 

 

I think thats what it's called anyway.

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On 22/10/2020 at 14:18, topflat29 said:

Ethermax,

 

If there is still 740 years on the lease and paying  low ground rent , you can make a compulsory purchase  of the freehold title at 20 x the ground rent by applying to the FTT .

 

21 hours ago, shazzamattazza said:

Is this true.? What is FTT?  Could JeffREy advise please. 

 

5 hours ago, geared said:

First Tier Tribunal 

 

I think thats what it's called anyway.

Yes- but there is no fixed price. The FTT might decide that it should be more than 20x or less than 20x.

Its decision will rest on the evidence put forwards by each party, pref. by a Chartered Surveyor's reasoned calculations.

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On 29/10/2020 at 12:40, topflat29 said:

Shazzam,

 

The  general info  about the  FTT  service   and    other  free guides on  other leasehold  issues  can be downloaded from LEASE website  :

 

https://www.lease-advice.org/advice-guide/application-first-tier-tribunal-property-chamber/

Thanks topflat for the link and info.

On 27/10/2020 at 17:06, Jeffrey Shaw said:

 

 

 

Yes- but there is no fixed price. The FTT might decide that it should be more than 20x or less than 20x.

Its decision will rest on the evidence put forwards by each party, pref. by a Chartered Surveyor's reasoned calculations.

Thanks Jeffery, we may be in touch.

Edited by shazzamattazza

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