Buying a leasehold property.

4 out of 10 new properties that are sold in Wales and England are being sold on leasehold. Ranging from bedroom flats in urban areas to detached homes in the rural areas, if you want to buy a property you will in most cases purchase it on leasehold terms. Because of this, it is very important to understand what a lease include in order to avoid being involved in a ground rent scandal in the future.

Ground rent.

When you are purchasing a leasehold property, you should always be ready to pay ground rent. This is the annual charges that a leaseholder is expected to pay to the owner of the freeholder because of “using” his land. The amount is usually fixed but the lease can include a clause that allows the freeholder to increase the cost payable in like 8 years so you must be keen to check on that. The average cost of ground rent payed in a year is around 319 euros.

Ground rent is one of the things that causes a lot of dissatisfaction to most leaseholders. Most of the leaseholders feel that it is not fair how the ground rent keeps on increasing since they purchased the property. This is why it is vital to make sure you get all the details of the lease right. To make your work easier, you can use the help of a solicitor to help you with the paperwork when you are buying a leasehold property. This way you can be sure of avoiding all the unexpected costs and being involved in a ground rent scandal.

Service charge.

The service charge is a fee that is payed to the landlord by all the residents of all the flat which contribute to the upkeep of the building. The freeholder is not responsible of providing any upkeep services that are not stipulated on the lease.