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Thread: Should I buy a property abroad?

  1. #51
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    Ive never understood owning a property abroad when for the price of buying it and upkeep and potential loss divided by the time you actually spend in it. I would rather just rent someone else’s as after all when I travel its to explore not sit in my own house elsewhere well after week. It’s a big planet and being constrained to one spot isn’t my idea of fun.
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  2. #52
    Can see the argument that the alternative of renting for few weeks now and then is cost effective but if planning to spend months somewhere else when retired could be expensive.

    Of course the OP is 49. Everyone here seems to retire at 50-55 with a bit of consultancy work, right?

  3. #53
    Grand Master Passenger's Avatar
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    Quote Originally Posted by Kingstepper View Post
    Neatly done.

    Tbh it's not going to be for everyone, suit everyones personality, requirements or aspirations...for us it was part of a plan that came together and allowed us to retire at 40 and devote tme to our son and enjoy the freedom and opportunity to please ourselves when health and fitness are still comparatively good and with luck will remain so for some time yet.
    The weather is great here averaging 300 sunny days pa, it's called the Costa Calida/ the warm coast with good reason and it's inexpensive and compared to other Costas still relatively undeveloped in some parts. Almost without exception the people have been warm and friendly too, couldn't be more different to London.
    OP if you do decide to visit this area of Spain when the pandemic calms down, give me a shout if you like and I'd be happy chat, show you around if you wish...lock up and leave type apartments are available sub your budget fwiw, though you'd be better off renting , spending time in whichever place thus getting to know it better first imho.

    Best of luck whatever you decide
    Last edited by Passenger; 6th March 2021 at 10:33.

  4. #54
    Grand Master mart broad's Avatar
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    IMO if you are asking a bunch of strangers on a forum then a definite NO
    I FEEL LIKE I'M DIAGONALLY PARKED IN A PARALLEL UNIVERSE

  5. #55
    Grand Master ryanb741's Avatar
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    I'll go out on a limb and state I'd do what the OP wants. Buy abroad and rent here. Property prices in most of the UK will tank. So don't worry - those people thinking they are sitting on a lot of equity will soon be sitting on a lot less ;)

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  6. #56
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    I don’t think UK property prices will tank though there maybe a c.10% adjustment post stamp duty holiday.
    I think if I just had one residence my preference would be UK as it is relatively easy to dispose of the asset if required and it will probably appreciate in value over the long term.
    I’ve lived in Cyprus, UAE, US etc and at times was tempted to buy. In most of these regions there have been serious price corrections at some time in the last 20 years.
    Also, living in another country full time is very different to holidaying there.
    I’ve battled whether to buy another property or not and realistically investing in stocks gives you a more secure better overall return over a medium term.
    Therefore, it makes more sense to rent something for 2 weeks and avoid all the hassle of ownership in my opinion.


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  7. #57
    Personally I wouldn’t be leaving an established job and/or looking to make a big property decision - unless I really had to - when we’re on the cusp of leaving the pandemic and the country has to face up to the cost. It’s all about weighing up the risks, but to me - especially if you don’t have a large financial cushion - it seems a little rash in the current climate


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  8. #58
    Grand Master AlphaOmega's Avatar
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    Quote Originally Posted by ryanb741 View Post
    I'll go out on a limb and state I'd do what the OP wants. Buy abroad and rent here. Property prices in most of the UK will tank. So don't worry - those people thinking they are sitting on a lot of equity will soon be sitting on a lot less ;)

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    We all acknowledge there is pain coming our way but TTC would be hoping one property market outperforms another net of additional expenses and inconveniences. Then he would need to time the market to get back into the UK if he had to.

    I have to say that seems like quite a high risk play.

  9. #59
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    Don't do it. Keep property here and rent if needed abroad. Its a terrible idea IMHO

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  10. #60
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    Quote Originally Posted by smalleyboy1 View Post
    If you fly to the property, what happens if the carrier pulls the route
    The locos screwed a lot of second homers in Europe by starting up a new route heavily subsidised by the local authorities incentive for an airline to use their new "international" airport only to pull the plug once the numbers didn't stack up when the bung ran out.

    As much as I like particular places in the world, if I reserve what I would spend on insurance/maintenance/interest etc and pop that in my holiday pot, it gives me the freedom to choose different places for my holidays. I just don't get the attraction of owning somewhere that you stay in a few weeks of the year but that drains your wallet 365 days of the year.

  11. #61
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    Quote Originally Posted by RobDad View Post
    Personally I wouldn’t be leaving an established job and/or looking to make a big property decision - unless I really had to - when we’re on the cusp of leaving the pandemic and the country has to face up to the cost. It’s all about weighing up the risks, but to me - especially if you don’t have a large financial cushion - it seems a little rash in the current climate
    This, 10 times.
    The profile you have drawn in your posting history says that whilst in a secure, decent job, you're a sole earner and sometimes things get a bit too tight for comfort.
    You haven't built much equity at this point in your life comparatively (this is by no means a sneer at £100K, but a reality check on how far -or not- that money takes you). You have children who may want to go to Uni later, you're probably not in a situation where you can afford health insurance year round if living in another country after retirement...
    I completely understand the realisation that you're running to spin a wheel, and the attraction of stepping out of it to "enjoy life", but start by putting aside every month enough to spend a week or two every year in Cyprus or elsewhere say for Easter, independently from what you do in Summer.
    Equity isn't in my mind a savings account you can tap into as and when it pleases, despite the number of adverts you will see on TV for the service.
    'Against stupidity, the gods themselves struggle in vain' - Schiller.

  12. #62
    Sounds like a terrible idea fraught with risk for someone in your position. Aside from anything else, buying, selling and running costs can be much higher overseas than in the UK. You don't seem to have anything like the cushion you'd want/need to make this work.

  13. #63
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    Don't do it.

    Although home ownership in a warm climate can seem jolly the reality can be somewhat different.

    I dallied with the idea years ago as my uncle owned a property in Malta but the thought of "having" to go back to the same place year after year and paying all the bills there whilst your rental costs in the UK are increasing also with associated bills seems madness IMO.
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  14. #64
    Master Thewatchbloke's Avatar
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    I think too many people think equity is an account you draw on when you want a new kitchen, bathroom or even holiday. I've always been of the opinion that equity in your home is meaningless as it is your home and you have to live somewhere!

  15. #65
    Firstly i have no personal experience of this, but hey it's the internet so my opinion is just as valid :)

    I have maybe 10-12 friends and relatives who have all done this and the universal answer is don't, its something i have thought of and come close to doing, on paper is seems so perfect but i think it's one of those things you think you want but the reality is nothing like that. If you are so rich you can buy exactly what you want and don't care if you lost it alland can pay for a continual housekeeper and maintenance contract then maybe, but otherwise:-

    1) Think how expensive it was to buy your first house, all the taxes, fees, now imagine doing that in a foreign language in a system you are unfamiliar with, just write a whole load of bank cheques
    2) think of the cost excluding mortgage of running and maintaining your house, the maintenance cleaning, gardening etc- now double it as you'll have twice the costs
    3) think of the time you spend having to do the chores around the home that you don't pay for, double that two
    4) think how hard it was to find the right house in the right area when you were looking to buy, imagine trying to do that remotely
    5) think how much you worry when you go away and leave your house all sealed up, of potential problems, how they multiply if not resolved or the security problems, especially as it will be obvious to everyone when you go away you won't be back for a while, thefts from second homes are much more common it's why in your insurance you're not mean to leave the house unoccupied for 30 days
    6) think how you like to choose where you go, or even if you want to stay home, that goes any holiday you have go to your holiday home no other location, rapidly there is little left to explore or discover, the very thing about holidays, the change is removed as it al becomes routine
    7) think about how you have rights and a voice, it's easy for places to place higher taxes on non resident home owners, as a non resident you don't even get asked, just a new bill in the post
    8) think about how you're going to get there? if you fly you'll need to pay for parking all the time you're there and needs to rent or own a car out there with all the relevant expenses or drives that takes a day
    9) think about furniture, condiments, cleaning stuff, tools- all ether have to be brought with you or replicated out there
    10) think how hard it is when friends and family start asking to borrow it, the first few times they're grateful before you know it, you get calls of, would it be ok if we borrowed your house for a couple of weeks in june again, but you're not using it....
    11) finally our possessions get smeared across both houses, have you seen my... then after 2 hours looking for it discover it's at the other house

    Most the the people i know who have done it, especially those who stretched themselves to do it, in the end it felt like a millstone around their neck, they stopped enjoying it and then found it hard to get rid of

    for it to make financial sense as in the cheaper to buy rather then rent you need to be spending big chunks of time out there, 3-6 months a year, doable in retirement less so when you're working. Except in retirement you can go out of holiday when it quiet, so you do and then hotels and rentals are cheaper

    I've played with the idea, sit down and consider when you're going to go, what is it that makes a holiday for you, if you like going to the same place, speak the language, love the culture and have the time and money for it, then it can be great. In the end i figured it falls into that category of things you're meant to want if you had the money, boat, plane, classic care collection, mistress, houses overseas the reality is never as good as you think it's going to be

  16. #66
    Grand Master TaketheCannoli's Avatar
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    Thank you all for an array of opinion and experience, that's exactly why I pose you such questions (rather than asking a load of strangers on a forum as has been suggested). I'm definitely in the midst of a mid-life crisis. If I'm lucky I've got thirty good years left on the mortal coil and want to make sure I enjoy as much of that as possible. I'm not convinced buying a property abroad is the best thing for us, I simply wanted to capture views.

    We have some key decisions to make this year.

  17. #67
    I toy with the same idea all the time. I’ve worked solidly for the last 20 years and am tired in body and mind and wish to enjoy some time in the sun. Fortunately, I’m mortgage free at 37 this month, house is worth about £700k. I’ve been told I could rent it for between £2k and £2500 pcm. My theory is now not to buy abroad (which I had my heart set in),but to rent. For £1200 a month I can rent a nice villa in Cyprus so I could rent my house out, rent a villa abroad and still have up to £1300 extra income per month..if I get bored of Cyprus I could pop to Spain. Get bored of Spain rent somewhere else. All the while hoping the uk house continues to rise. Probably a better bet than a £500k villa in Spain/Cyprus. Could be a flawed way of looking at it but this is what I’ve come up with so far..

  18. #68
    Grand Master Dave+63's Avatar
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    Quote Originally Posted by Yeti View Post
    I toy with the same idea all the time. I’ve worked solidly for the last 20 years and am tired in body and mind and wish to enjoy some time in the sun. Fortunately, I’m mortgage free at 37 this month, house is worth about £700k. I’ve been told I could rent it for between £2k and £2500 pcm. My theory is now not to buy abroad (which I had my heart set in),but to rent. For £1200 a month I can rent a nice villa in Cyprus so I could rent my house out, rent a villa abroad and still have up to £1300 extra income per month..if I get bored of Cyprus I could pop to Spain. Get bored of Spain rent somewhere else. All the while hoping the uk house continues to rise. Probably a better bet than a £500k villa in Spain/Cyprus. Could be a flawed way of looking at it but this is what I’ve come up with so far..
    No flaws in that view. The only potential issue is with your tenants not paying the rent. If you can afford a few months without the rental income then it could be a perfect solution.

  19. #69
    Grand Master Chris_in_the_UK's Avatar
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    Quote Originally Posted by Yeti View Post
    I toy with the same idea all the time. I’ve worked solidly for the last 20 years and am tired in body and mind and wish to enjoy some time in the sun. Fortunately, I’m mortgage free at 37 this month, house is worth about £700k. I’ve been told I could rent it for between £2k and £2500 pcm. My theory is now not to buy abroad (which I had my heart set in),but to rent. For £1200 a month I can rent a nice villa in Cyprus so I could rent my house out, rent a villa abroad and still have up to £1300 extra income per month..if I get bored of Cyprus I could pop to Spain. Get bored of Spain rent somewhere else. All the while hoping the uk house continues to rise. Probably a better bet than a £500k villa in Spain/Cyprus. Could be a flawed way of looking at it but this is what I’ve come up with so far..
    Sounds doable and (importantly) flexible.
    When you look long into an abyss, the abyss looks long into you.........

  20. #70
    I’ve toyed with the idea, until I was buying both here and in Australia, but now the Australia purchase is no longer in my plans, I would still consider buying somewhere abroad for long holidays etc. but only as a joint purchase with my brothers - otherwise I just don’t think it would get the use to do it justice.
    It's just a matter of time...

  21. #71
    Grand Master Mr Curta's Avatar
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    We've lived overseas for 17 of the past 23 years, letting out first one and then two houses in the UK. The longest we have been without tenants in either was for two months and that was in order to update and redecorate. You do need to allow for unexpected expenses (a network of friendly artisans back at home is invaluable) and bear in mind income tax implications.
    Don't just do something, sit there. - TNH

  22. #72
    Grand Master ryanb741's Avatar
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    Quote Originally Posted by Thewatchbloke View Post
    I think too many people think equity is an account you draw on when you want a new kitchen, bathroom or even holiday. I've always been of the opinion that equity in your home is meaningless as it is your home and you have to live somewhere!
    Exactly. And the 'comparatively you should be £x in equity' is appalling.

    I'm in my early 40s, earn a salary that is in the 100s of £k per year and yet live in a 2 bed London flat that is today worth less after 7 years living in it than the mortgage on it due to being unlucky with a dodgy lease encompassing doubling ground rent that makes it virtually unsellable. Should I be self flagellating at being behind the curve?

    Life is too short. If you want to live somewhere else do it if you can as you may not get the chance later.

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  23. #73
    Grand Master JasonM's Avatar
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    Quote Originally Posted by Thewatchbloke View Post
    I think too many people think equity is an account you draw on when you want a new kitchen, bathroom or even holiday.
    When did you meet my wife?

  24. #74
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    Quote Originally Posted by Mr Curta View Post
    We've lived overseas for 17 of the past 23 years, letting out first one and then two houses in the UK. The longest we have been without tenants in either was for two months and that was in order to update and redecorate. You do need to allow for unexpected expenses (a network of friendly artisans back at home is invaluable) and bear in mind income tax implications.
    Also capital gains tax may need to be considered depending on whether and when you might find yourself selling.

    For me the bigger concern if it was my home and I had any plans to return and live in it again is that you can’t rely on tenants taking anything like good care. If it’s an investment then there can be some emotional detachment but not if it is a home, at least in my case.

  25. #75
    Quote Originally Posted by draftsmann View Post
    Also capital gains tax may need to be considered depending on whether and when you might find yourself selling.

    For me the bigger concern if it was my home and I had any plans to return and live in it again is that you can’t rely on tenants taking anything like good care. If it’s an investment then there can be some emotional detachment but not if it is a home, at least in my case.
    In my experience I vet the tenants and I’ve generally had good luck with tenants. If your renting £600 one bed flats out I’d imagine the tenants may be at the lower end of the scale whereas nowadays people who are renting £1500 plus properties have to prove income etc so are generally employed and in my experience don’t cause too many issues.
    Also in terms of capital gains, I only have one residential property which as long as I moved back into it for a period before selling it, I don’t think I’d have to pay capital gains..

  26. #76
    Grand Master MartynJC (UK)'s Avatar
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    Quote Originally Posted by Passenger View Post
    But if he burns through part or all of that 100k what will he use to eventually buy a place some where that feels like home...

    Good advice I thinks been offered, well meant, speak to a financial planner, get a big picture assessment of financial health and wealth.
    Hopefully the OP continues to earn money - and equity increases overtime. I agree a FA is what is needed here. Perhaps too many, "A Place in the Sun" have been watched? Personally I can't wait to get back to Portugal and get a property purchased and move!

  27. #77
    Quote Originally Posted by ryanb741 View Post
    Exactly. And the 'comparatively you should be £x in equity' is appalling.

    I'm in my early 40s, earn a salary that is in the 100s of £k per year and yet live in a 2 bed London flat that is today worth less after 7 years living in it than the mortgage on it due to being unlucky with a dodgy lease encompassing doubling ground rent that makes it virtually unsellable. Should I be self flagellating at being behind the curve?

    Life is too short. If you want to live somewhere else do it if you can as you may not get the chance later.

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    Ryan have you seen this?

    https://www.gov.uk/government/news/g...uy-their-homes

    Should hopefully help your situation.

  28. #78
    Grand Master ryanb741's Avatar
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    Quote Originally Posted by eagletower View Post
    Ryan have you seen this?

    https://www.gov.uk/government/news/g...uy-their-homes

    Should hopefully help your situation.
    Yes saw that but thanks for sharing. Waiting for further guidance - as it stands the freeholder has offered this for a charge of £50k and I've told them to jump off the nearest bridge. I'd imagine it will come down to £10k or so after time which will be a no brainer as the impact on the value of the property would be significant.

    I also have an issue with the cladding also but that's another story lol.

    As an FYI if anyone is thinking of buying a new build property from Redrow - don't! Unethical company.

  29. #79
    Grand Master Passenger's Avatar
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    Quote Originally Posted by MartynJC (UK) View Post
    Hopefully the OP continues to earn money - and equity increases overtime. I agree a FA is what is needed here. Perhaps too many, "A Place in the Sun" have been watched? Personally I can't wait to get back to Portugal and get a property purchased and move!
    May that day come swiftly for you, best of luck, I seem to recall you've narrowed the pool of possibilities down to some very attractive properties. Enjoy.

  30. #80
    Master arthurDALEY's Avatar
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    Quote Originally Posted by eagletower View Post
    Ryan have you seen this?

    https://www.gov.uk/government/news/g...uy-their-homes

    Should hopefully help your situation.
    Does this change the price you would pay to renew your lease, or just the ground rent you pay as well as ?

    Thanks in Advance

  31. #81
    Grand Master ryanb741's Avatar
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    Quote Originally Posted by arthurDALEY View Post
    Does this change the price you would pay to renew your lease, or just the ground rent you pay as well as ?

    Thanks in Advance
    I already have a 900 year lease with ground rent of £400 a year doubling every 10 years. Mortgage lenders deem this as an onerous clause meaning they won't lend against it. You can currently extend by 90 years which would ordinarily be pointless with a 900 year lease however it means ground rent goes to £0. As this has typically been a situation involving lawyers and no set guidelines as to pricing the free holders have been super greedy and in ny case asked £50k. They were told where to go. Fair value would be around £8k (20x ground rent of £400). Doing this would make the property more sellable in the mainstream and increase the flat's value by around £230k.

    The new legislation will in theory make it easier to extend lease and get £0 ground rent and thereby lower the legal costs plus in theory the cost of the extension itself.

    Flip side is I'd imagine quite a few pension funds have these freehold companies in their portfolios so will be interesting to see how that gets hit.

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  32. #82
    Grand Master Dave+63's Avatar
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    Quote Originally Posted by ryanb741 View Post
    I already have a 900 year lease with ground rent of £400 a year doubling every 10 years. Mortgage lenders deem this as an onerous clause meaning they won't lend against it. You can currently extend by 90 years which would ordinarily be pointless with a 900 year lease however it means ground rent goes to £0. As this has typically been a situation involving lawyers and no set guidelines as to pricing the free holders have been super greedy and in ny case asked £50k. They were told where to go. Fair value would be around £8k (20x ground rent of £400). Doing this would make the property more sellable in the mainstream and increase the flat's value by around £230k.

    The new legislation will in theory make it easier to extend lease and get £0 ground rent and thereby lower the legal costs plus in theory the cost of the extension itself.

    Flip side is I'd imagine quite a few pension funds have these freehold companies in their portfolios so will be interesting to see how that gets hit.

    Sent from my SM-G950F using Tapatalk
    As £50k equates to around 35 years ground rent (of the 990 years), it doesn’t seem too greedy at all to me.
    Additionally, as the value of your property will increase by almost five times that amount, it seems a no brainer to me. Even without considering that you’ll actually be able to sell the property when you want to.

    It seems to me as an outsider Ryan, that you’re letting emotions get in the way of making the best decision for you and your family.

  33. #83
    Master arthurDALEY's Avatar
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    Thanks Ryan / Dave

    We have 50yrs left on the lease and are looking to extend, upstairs done theirs before the new legislation came in and it cost around £30k
    flat worth £170k without short lease £200k with lease ,,, seems that is how they work it out to a layman ?
    So you think this would/should be lower in the future... funnily enough our ground rent is something silly like £30 a year !

    Cheers

  34. #84
    Quote Originally Posted by ryanb741 View Post
    I already have a 900 year lease with ground rent of £400 a year doubling every 10 years.
    Doubling 90 times?

    There aren't that many grains of sand on the planet, never mind pounds to pay the bill.

    £495,176,000,000,000,000,000,000,000,000 would be the final payment, but of course you'd never get that far.

  35. #85
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    Quote Originally Posted by ryanb741 View Post
    I already have a 900 year lease with ground rent of £400 a year doubling every 10 years. Mortgage lenders deem this as an onerous clause meaning they won't lend against it. You can currently extend by 90 years which would ordinarily be pointless with a 900 year lease however it means ground rent goes to £0. As this has typically been a situation involving lawyers and no set guidelines as to pricing the free holders have been super greedy and in ny case asked £50k. They were told where to go. Fair value would be around £8k (20x ground rent of £400). Doing this would make the property more sellable in the mainstream and increase the flat's value by around £230k.

    The new legislation will in theory make it easier to extend lease and get £0 ground rent and thereby lower the legal costs plus in theory the cost of the extension itself.

    Flip side is I'd imagine quite a few pension funds have these freehold companies in their portfolios so will be interesting to see how that gets hit.

    Sent from my SM-G950F using Tapatalk
    I’m not a leaseholder currently so don’t pretend to understand the ins and outs of this particularly. But how do you come up with a ‘fair value’ of £8k for this extension? That must be way too low surely?

    - - - Updated - - -

    Quote Originally Posted by guinea View Post
    Doubling 90 times?

    There aren't that many grains of sand on the planet, never mind pounds to pay the bill.

    £495,176,000,000,000,000,000,000,000,000 would be the final payment, but of course you'd never get that far.
    Ignore me - was considering the extension!
    Last edited by Peck; 7th March 2021 at 10:36.

  36. #86
    Grand Master TaketheCannoli's Avatar
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    The lease situation in the UK is a nightmare. Homes in our area are becoming unsellable as the original leases were for 99 years. Lenders typically want loan term plus 25 to 50 years to the lease which now isn’t possible.

    When we sold our last house in 2008 the sale was delayed by three months as we had to buy the freehold before it could complete. That cost me £3600. So once we got into this house we bought this freehold too at another £4000 to ensure we own the land we stand on and a hassle free sale should we decide to move on.

  37. #87
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    Quote Originally Posted by ryanb741 View Post
    Yes saw that but thanks for sharing. Waiting for further guidance - as it stands the freeholder has offered this for a charge of £50k and I've told them to jump off the nearest bridge. I'd imagine it will come down to £10k or so after time which will be a no brainer as the impact on the value of the property would be significant.

    I also have an issue with the cladding also but that's another story lol.

    As an FYI if anyone is thinking of buying a new build property from Redrow - don't! Unethical company.
    They have a pretty big development in maidenhead right now. More affordable than most in this area

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  38. #88
    Grand Master Dave+63's Avatar
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    I’ve only ever owned one leasehold property. The ground rent was £20 per year with no uplift over the 999 year term. Even then it was a bit of a bind as I had to get permission to do any substantive work on the property. I also had to pay three or hour years back ground rent which the previous owner hadn’t paid.

    I can only feel for the many homeowners (such as Ryan) who are caught up in this nightmare and the sooner this shoddy practice is rectified, the better.

  39. #89
    Master murkeywaters's Avatar
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    I’m a few years younger than the OP and I think at this age sometimes your head goes left field!

    Sometimes a combination of hitting age points and reflecting on good times gone suddenly dawns on you that it was 30 years ago and possibly you have 30 years or less left, not a very nice thought but reality.

    Also at this age many of us have children at key ages, parents older possibly in need of care or worse so it can be a real testing, stressful time where we ask some serious questions.

    On the plus side investments have built up and opportunities are available, I often look at what I owe on the mortgage, how much equity there is in the house, watches, cars etc and think sod it, sell the lot and buy a house in Devon with land and enjoy life, but reality is my son is 14 so a key age building towards exams, I can’t really be further than a 30 min drive from my mother so it’s not going to happen.

    The other reality is I’m happy where I live, what I do and just put those thoughts down as a mid life brain fart, OP your probably having a brain fart, give it another 2-5 years and see how you feel then and where your finances are..

  40. #90
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    Quote Originally Posted by Dave+63 View Post
    I’ve only ever owned one leasehold property. The ground rent was £20 per year with no uplift over the 999 year term. Even then it was a bit of a bind as I had to get permission to do any substantive work on the property. I also had to pay three or hour years back ground rent which the previous owner hadn’t paid.

    I can only feel for the many homeowners (such as Ryan) who are caught up in this nightmare and the sooner this shoddy practice is rectified, the better.

    Leaseholds on flats have always been the way, haven’t they? It’s why I’d never buy a flat. Plenty in the news about the situation Ryan is in, has been for years, what surprises me is how the original purchaser can get a mortgage but then has issues selling it on. We are buying a holiday home in North Norfolk - I’ve compromised on the price limit but we are getting a freehold, not a leasehold - it’s my one red line.

    Leaseholds on a house are recent “innovation” and are a disgrace

    If the OP gets this far then I’d advise agains t his plan as I don’t think £100k is enough to do it. Seeing an IFA would force you to look at your current situation as a whole and set up plans for the future so that might be worth doing, as you are at a crossroads.

  41. #91
    Grand Master ryanb741's Avatar
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    Quote Originally Posted by Dave+63 View Post
    As £50k equates to around 35 years ground rent (of the 990 years), it doesn’t seem too greedy at all to me.
    Additionally, as the value of your property will increase by almost five times that amount, it seems a no brainer to me. Even without considering that you’ll actually be able to sell the property when you want to.

    It seems to me as an outsider Ryan, that you’re letting emotions get in the way of making the best decision for you and your family.
    Yes but it is £50k to make.my property mortgageable due to shoddy practices conducted by developers and free holders with conveyancers appointed by housebuilders in on the game. The £50k gets the property back to what it would have been worth without this dodgy practice, not to make it worth an incremental £200k above what it would be much like someone investing in a house extension.

    The £400 a year ground rent I always knew about and have no issue with. It would be up.to the freeholder to remedy their issue with leaseholders else they will.end up with a freehold worth much less than it would otherwise be worth. The government seem to have a mandate in place for this.

    Sent from my SM-G950F using Tapatalk

  42. #92
    Grand Master Dave+63's Avatar
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    Quote Originally Posted by ryanb741 View Post
    Yes but it is £50k to make.my property mortgageable due to shoddy practices conducted by developers and free holders with conveyancers appointed by housebuilders in on the game. The £50k gets the property back to what it would have been worth without this dodgy practice, not to make it worth an incremental £200k above what it would be much like someone investing in a house extension.

    The £400 a year ground rent I always knew about and have no issue with. It would be up.to the freeholder to remedy their issue with leaseholders else they will.end up with a freehold worth much less than it would otherwise be worth. The government seem to have a mandate in place for this.

    Sent from my SM-G950F using Tapatalk
    I understand where you’re coming from and appreciate that it’s a bitter pill to swallow, but you are where you are and paying the £50k will realise you an extra £230k from where you are now.

    Not paying the £50k will leave you £180k worse off.

    I’d hate to pay it too, I really would, but paying it is the sensible decision.

    What would your advice be if it were someone else (a friend or family member for example) in your position?

  43. #93
    Grand Master TaketheCannoli's Avatar
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    I think Dave's right Ryan. It will stick in your throat for a while but ultimately will be the best outcome for you and will release you from the limbo you're currently in.

    Quote Originally Posted by Dave+63 View Post
    I understand where you’re coming from and appreciate that it’s a bitter pill to swallow, but you are where you are and paying the £50k will realise you an extra £230k from where you are now.

    Not paying the £50k will leave you £180k worse off.

    I’d hate to pay it too, I really would, but paying it is the sensible decision.

    What would your advice be if it were someone else (a friend or family member for example) in your position?

  44. #94
    Master murkeywaters's Avatar
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    Should I buy a property abroad?

    Quote Originally Posted by thenikjones View Post
    Leaseholds on flats have always been the way, haven’t they? It’s why I’d never buy a flat. Plenty in the news about the situation Ryan is in, has been for years, what surprises me is how the original purchaser can get a mortgage but then has issues selling it on. We are buying a holiday home in North Norfolk - I’ve compromised on the price limit but we are getting a freehold, not a leasehold - it’s my one red line.

    Leaseholds on a house are recent “innovation” and are a disgrace

    If the OP gets this far then I’d advise agains t his plan as I don’t think £100k is enough to do it. Seeing an IFA would force you to look at your current situation as a whole and set up plans for the future so that might be worth doing, as you are at a crossroads.
    Nothing wrong with leaseholds as long as you do your homework, always was an issue about lenders not lending on 69 years or less and lease owners holding the homeowner to ransom, but new rules brought in January allow home owners to increase their lease to 990 years for effectively zero.

    I do get the yearly charges and ground rent can be prohibitive but again due diligence by yourself and conveyancer should iron a lot of this out, the cladding issue is just unavoidable and I really feel for those stuck in homes that are un-mortgageable..

  45. #95
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    Leaseholds on a house are recent “innovation” and are a disgrace
    Not true. Our 1920s house in Sheffield was on a long lease, as is the case with lots of property in that area. £6 a year and no problem whatsoever with mortgage etc. From all perspectives, including the price we got when we sold it, it was the same as a freehold.

  46. #96

    Should I buy a property abroad?

    Quote Originally Posted by ryanb741 View Post
    I already have a 900 year lease with ground rent of £400 a year doubling every 10 years. Mortgage lenders deem this as an onerous clause meaning they won't lend against it. You can currently extend by 90 years which would ordinarily be pointless with a 900 year lease however it means ground rent goes to £0. As this has typically been a situation involving lawyers and no set guidelines as to pricing the free holders have been super greedy and in ny case asked £50k. They were told where to go. Fair value would be around £8k (20x ground rent of £400). Doing this would make the property more sellable in the mainstream and increase the flat's value by around £230k.

    The new legislation will in theory make it easier to extend lease and get £0 ground rent and thereby lower the legal costs plus in theory the cost of the extension itself.

    Flip side is I'd imagine quite a few pension funds have these freehold companies in their portfolios so will be interesting to see how that gets hit.

    Sent from my SM-G950F using Tapatalk
    Doubling every 10 years is similar to increase in house prices so not that outrageous and if house price rises continue will remain a roughly similar proportion of the house price.
    Presumably people buy these properties with their eyes wide open and if not they should do.

  47. #97
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    Quote Originally Posted by murkeywaters View Post
    .

    On the plus side investments have built up and opportunities are available, I often look at what I owe on the mortgage, how much equity there is in the house, watches, cars etc and think sod it, sell the lot and buy a house in Devon with land and enjoy life, but reality is my son is 14 so a key age building towards exams, I can’t really be further than a 30 min drive from my mother so it’s not going to happen.
    You and me both. Often run the numbers with this kind of thing in mind - cash it all in and clear the debts and then see what we want to do. Thing is, I think we (me and wife) have different views on how we see the future.

  48. #98
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    Quote Originally Posted by ryanb741 View Post
    Yes but it is £50k to make.my property mortgageable due to shoddy practices conducted by developers and free holders with conveyancers appointed by housebuilders in on the game. The £50k gets the property back to what it would have been worth without this dodgy practice, not to make it worth an incremental £200k above what it would be much like someone investing in a house extension.

    The £400 a year ground rent I always knew about and have no issue with. It would be up.to the freeholder to remedy their issue with leaseholders else they will.end up with a freehold worth much less than it would otherwise be worth. The government seem to have a mandate in place for this.
    Sent from my SM-G950F using Tapatalk
    Ryan I think you’ve got two realistic choices (apart from doing nothing and your long term property fate being in someone else’s hands):

    Firstly look at the realistic chance of you getting the price of 50k down - in other words are the government going to do something to help? can you all get together and fight this? can you negotiate? Are there any other moves you could make? Some form of compromise would be the best solution.

    Secondly if that’s not viable you should bite the bullet and buy the freehold. Take long term control of your home and add the value back to where it should be. A bitter pill to swallow but if the first option doesn’t work then you are the one losing out by not doing this.

    It’s almost like a random strip in a weird way.

    I’d want to know how they calculate this 50k - what’s it based on?

    Developers where I live years ago used to put clauses into house where if the owners did big extensions or sold plots they would get an uplift. This happens now but I’m talking from the 70’s and 80’s. We had a client that got planning to build a house on the side of his and the developer would have got 35k - the developer went bust 30 years ago and no one took on the book so to speak. I think they had to pay an indemnity fee just in case.

  49. #99
    Master arthurDALEY's Avatar
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    So if i renew my lease ... It would currently cost me £30k , would these new rules bring this price down at all ?

  50. #100
    Grand Master Dave+63's Avatar
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    Quote Originally Posted by bambam View Post
    Thing is, I think we (me and wife) have different views on how we see the future.
    I can relate to this. In the wife’s vision it means constantly shaking the magic money tree!

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