Freehold Anomaly

[moopind 10]

I have a leasehold property in Crookes (terraced house) which has an annual ground rent of £2.62 on a 900-year lease from 1898 (so 778 years left on the lease). I wanted to buy the freehold, which appeared to be held by an individual investor living in a different part of the UK. Around 18 months ago, the owner of the freehold asked for the ground rent via a property agency (in Sheffield) as per usual, but sent me a letter saying that the agency would no longer be collecting the ground rent (presumably because it wasn't cost effective for them for a small amount, sending a demand, taking payment to the bank etc.).

At that point I wrote back to the owner of the freehold asking if she would make me an offer for buying it out. She replied that she was very elderly and that the property agency had always taken care of her leasehold investments and that she would ask them to get in touch with me, implying it was beyond her capabilities to deal with it. I heard nothing for over a year (and half forgot about it). I have contacted the agency in the past week or so and they said:

 

"Apologies for the delay in replying.   We understand that Mrs X is looking to sell the portfolio however it would appear that none of the freehold interests are registered at the Land Registry and the costs for doing this far outweigh the value of the ground rent and we believe that this is the reason why no-one has been approached to manage the freeholds in the meantime. 

We would anticipate that the likely cost to purchase the freehold would be in the region of approximately £500 plus VAT and approximately £750 plus VAT for the vendor’s legal costs, plus your own legal fees.

We trust this is of assistance" (my emphasis)

 

I'm not sure how to interpret this. I feel like this information should put the ball in my own court, as the investment is all but worthless to the freeholder. Does anyone have any advice on how I could secure the freehold in the most cost-effective way?

 

Thanks in advance for any help.

[geared 317]

That seems like a half accurate cost, give or take.

 

Given the odd situation you're best to have someone like Jeffrey Shaw deal with it.

 

[RiffRaff 10]

Pardon my ignorance in such matters, but does it mean that you/your predessors have been paying all those years to someone who didn't have the right to charge it?

 

[spider1 11]

You cant do this without a solicitor so you want to see mr shaw  about a guistimate 

[Jeffrey Shaw 90]

43 minutes ago, RiffRaff said:

Pardon my ignorance in such matters, but does it mean that you/your predecessors have been paying all those years to someone who didn't have the right to charge it?

 

No. The fact that a legal ownership is unregistered (if in Sheffield) merely means that it has not been:

a. purchased since before November 1970**; nor

b. transferred by gift/Assent since before 1 April 1998.

 

[** Read this as '1 April 1974' for areas such as Stocksbridge/Wortley that were added to Sheffield in 1974]

 

3 hours ago, moopind said:

Does anyone have any advice on how I could secure the freehold in the most cost-effective way?

Maybe team-up with interested neighbouring leaseholders? If several purchase at the same time, it might reduce the fees per head. also, I occasionally have clients who do buy small f/r portfolios- i.e. they might look at buying what you and the neighbours don't.

 

15 minutes ago, spider1 said:

You cant do this without a solicitor so you want to see mr shaw  about a guistimate 

Although it is possible to do one's own conveyancing, I would strongly caution against this for hitherto-unregistered ownership; it's way more complex!

Edited November 2, 2020 by Jeffrey Shaw

[spider1 11]

So there you have it see all your neighours club together and buy  it . See mr shaw our solicitor let him sort it simple 

[RiffRaff 10]

6 hours ago, Jeffrey Shaw said:

No. The fact that a legal ownership is unregistered (if in Sheffield) merely means that it has not been:

a. purchased since before November 1970**; nor

b. transferred by gift/Assent since before 1 April 1998.

Thank you. I bow to your greater knowledge!