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Freehold on house has 12 years left - looking to buy, advice needed

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  • Freehold on house has 12 years left - looking to buy, advice needed

    Hello,

    My parents have lived in their house for nearly 40 years, but have never considered buying the freehold to the property until now. Nearing retirement age and having paid off their mortgage they are finally in a comfortable position to consider doing so... Naively however, they thought that the longer they lived in the property the cheaper the freehold price would be - after reading into the subject a little I have discovered that the opposite is true.. With such little time left before renewal they are in a difficult situation.

    They shrugged off my recommendation of an independent survey, and contacted the land owners directly to negotiate a price. They had a visit last week from them, no measurements were taken of the grounds but the house was thoroughly inspected room by room to gauge living standards/house condition/cleanliness etc... We estimated since the small terraced property is worth around £120k, the freehold would be 10-15 thousand.

    To our shock, a letter was received today with a figure almost double that! Ensuing the legals costs also we are estimating it to be around 30k! Unfortunately none of us are in a position to afford this financially, and have been told they only have 3 months to decide/commit. After that, a new survey will need to be completed and the price will go up. Also, they need to wait another 2 years for another opportunity to buy.

    Our only other alternative is to rent the land once the freehold has expires, the owner advised that this would cost anything from £15-£30 per week. A huge leap from the £2 per annum they are currently paying!

    Despite a lot of preparation and money saved by, they find themselves in an awkward and quite scary situation. Can anyone advice what best action to take? My first instinct says to negotiate a lower price, but is this successful in situations like this? I know nothing about land valuation, but 30 grand does seem like a high asking price - is this the going rate nowadays?

    Any advice or help will be much appreciated.
    Last edited by daws0n; 20-11-2010, 05:09 PM.

  • #2
    Re: Freehold on house has 12 years left - looking to buy, advice needed

    The problem seems to be a valuation issue - I suggest you contact a valuer who specialises in this sort of case. To find a local one, see Leasehold Advisory Service : Leasehold Practitioners
    This is based on my experience as a conveyancing solicitor in England, but I do not accept liability for information I give in this forum

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    • #3
      Re: Freehold on house has 12 years left - looking to buy, advice needed

      Thanks for your advice. We have contacted the lease hold advisory service, they advised that if they don't pay, there could be far more serious consequences in the near future once it expires.

      In the meantime, I have contacted a local land valuer to see if we can get an independent high/low valuation. I really hope we can barter if the valuation works out considerably cheaper, but at the same time we don't the land owner withdrawing their offer if we attempt to counter it.

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      • #4
        Re: Freehold on house has 12 years left - looking to buy, advice needed

        As I said in answer to a similar thread on another forum I cannot imagine why even 40 years ago a solicitor advised them to go ahead with the purchase of a house with only 52 years remaining on the lease.
        RICHARD WEBSTERwww.rwco.co.uk
        As a conveyancing solicitor I want to be helpful (England/Wales only) but can't accept liability for this.

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        • #5
          Re: Freehold on house has 12 years left - looking to buy, advice needed

          ^^

          I've left a longer post on the other forum, but what can I say - I completely agree. They were royally chumped on this one

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