If you’re looking to get your feet onto the UK property ladder and saving to pay for the deposit one of the most important decisions you’ll need decide on is whether you want to purchase leasehold or freehold. In recent times leasehold ownership has been given an unpopular reputation, as well. Many of the weaknesses of the system were brought into the attention of the public in the leasehold scandal of 2017.
However, leasehold ownership does not have to be an issue. There are a lot of advantages of owning a home through this method. All it boils down to your specific situation, your objectives and aspirations.
What are Freehold and Leasehold?
There are two major kinds of property ownership that are available in the UK. If you purchase freehold property, you hold the structure as well as the land it is situated on. Most houses are owned by this way. But, if you purchase leasehold properties which is about 99% of homes and apartments will grant you the right to use the property in accordance with the conditions of the Lease however the building remains the ownership of the owner of the freehold.
If you need help going through the lease process contact Leasehold Services…
A long-term lease for residential properties can be granted over a predetermined duration, usually 99 years or 125 years. It can even be 99 years. In the present, there are estimation of 4.8 million leasehold homes in the UK that is equivalent to 20% of the housing inventory. They can be purchased and sold in the market in open and the worth of the property based on a variety of other aspects on the amount of time remaining by the Lease.
Then, why would you purchase one?
1. Less expensive than Freehold
Leasehold properties typically consist of houses and flats, which tend to be smaller and less expensive than freehold properties, which makes them an ideal choice for those who are first-time buyers. There are a variety of affordable home ownership plans are offered. These homes, whether block conversions from the past, specifically-built homes or brand new houses, are more likely to be located in central areas and benefit from less commuting durations. In London there was more than 99 percent of new-build sales in the year of 2008 were leasehold.
2. Flexibility to extend the lease
If you’re concerned about the property becoming a depreciating asset because of the diminishing amount of years remaining on the lease, be aware that it’s possible in order to renew the lease in order that it doesn’t affect the future possibility of selling.
If certain eligibility requirements that must be satisfied, the statutory lease extension allows you to extend 90 years of the lease for a reasonable price and eliminate the ground rental.
3. No building maintenance
The maintenance of the communal areas and buildings is the obligation by the owner of the property. Leaseholders are required to pay a service charge each year for these and other related expenses. If your freehold is managed, and has a sinking fund to fund larger capital projects (new roof, painting/decorating window replacements etc.) It will allow you to concentrate on the home you want to own and not worry about the building work.
4. There is no maintenance for shared facilities.
The above-mentioned service fee includes any common areas like gardens as well as car parking, lifts CCT, as well as other security measures in addition to any leisure facilities shared by the community like swimming pools, fitness centers or children’s play areas. With all maintenance and upkeep taking by local tradesmen appointed and monitored by the freeholder or manager, this allows residents free to use the facilities they share without worry.
5. Capacity to Take Collective Action
If you are extremely worried about the way in which the building is being managed or the charges for services leaseholders have the option of taking control of the freeholder and take control of the building themselves through the Right to Manage (RTM). They can also apply to collective enfranchisement – purchasing leasehold freehold in exchange for a fee from their landlord. All is required is the leaseholders to be 50% to agree for the move to proceed in this manner.
6. An investment that is a good buy-to-let
While you may want to take the first step to the very first step of the ladder of property There are many advantages to buying your own house. Perhaps you’re more interested in finding an affordable investment opportunity to buy-to-let or leasehold property, which is why a leasehold apartment is a good option. Since leasehold properties tend to be less expensive than freehold, it can put a home in a prime location with an influx of rent within the reach within your financial budget. This could mean more rental income to you over the short term , and also the benefit of longer-term capital appreciation.
Zero Down Lease
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020 3856 8300