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Nobody is, it's perfectly possible to buy some not crappy new build that's not flimsy junk. It's like anything - there are good products and bad products.
Buying a house, Help2Buy
- Thread starter Delvis
- Start date
Nobody is, it's perfectly possible to buy some not crappy new build that's not flimsy junk. It's like anything - there are good products and bad products.
One thing to be aware of that we didn't pick up, if you want to end your H2B and cash it in/out you will need to pay for an independent surveyor to come out and value your house, there was quite possibly a processing fee for the redemption of it too but double check.
These things are buried in the T&Cs but not something they will tell you about up front as it's not the happy stuff.
These things are buried in the T&Cs but not something they will tell you about up front as it's not the happy stuff.
Is that actually legal?
On our leasehold property, we actually have a covenant in place that says if the freeholder wishes to sell the freehold, they have to give the current leaseholders first refusal. Basically meaning they can't sell it to an investor until we've turned it down/ignored the offer.
I guess if there's nothing in the leasehold agreement that's similar to ours, then there's nothing stopping the freeholder from selling it to whomever.
But it raises another point i recall looking into before buying a leasehold property. I don't believe the freeholder can demand whatever price they see fit to sell the freehold. As far as i'm aware it's based on a calculation of value of the property and remaining duration of the lease. So in your case, unless the property shot up in value massively, or the duration of your lease is short, an investor couldn't just buy the freehold and then sell it for five times more.
Yes, for houses it is legal if not specified otherwise in the lease as yours is. For flats the 'Right of First Refusal' via Section 5 notice applies. It's heavily frowned upon now and I believe that most developers have stopped doing it. If you do some googling of 'leasehold scandal' etc then you'll find plenty of examples of the big developers engaging in this shady practice.
In regards the price of a freehold there is no prescribed calculation, it's more or less a pseudo science based on lease length and ground rent. Generally the two parties come to an agreement though because if not it goes to tribunal and neither party wants the hassle. The reason investors are/were able to charge such high prices is that the developer often quoted an unrealistically low price - Not taking into account the fact that the leases had large ground rent escalators (e.g. doubling every 10-15 years). Once these escalators were taken into account the new freeholders were able to 'justify' the price. Bit of a scam really.
just going through this now in redeeming the HTB as we are selling.
You give them 20% of the sale price back or the RICS surveyed price...whatever is the highest so you then need to fight to get as close to this or if you sell under their value, you will still to pay back even more if RICS valuation is higher.
You will need a RICS HTB survey so you not telling porkies on value and this needs to be independent of a estate agent and this is circa £250
There is also a admin fee with redemption of around £200.
Hope this helps.
You give them 20% of the sale price back or the RICS surveyed price...whatever is the highest so you then need to fight to get as close to this or if you sell under their value, you will still to pay back even more if RICS valuation is higher.
You will need a RICS HTB survey so you not telling porkies on value and this needs to be independent of a estate agent and this is circa £250
There is also a admin fee with redemption of around £200.
Hope this helps.
Cheers all so far, interesting reading everyones thoughts and stories!
We've got the solicitor forms and we're filling those in. HTB application filled and returned.
Also got the initial Mortgage letter through and all seems decent enough and is below what we budgeted for worst case. Theres a nice caveat in there stating if you sell before the 5 year term is up (on this particular mortgage) you would need to pay a % fee if sold. Don't think we will be selling before that time is up but its something for us to consider and have in the back of our heads.
We've got the solicitor forms and we're filling those in. HTB application filled and returned.
Also got the initial Mortgage letter through and all seems decent enough and is below what we budgeted for worst case. Theres a nice caveat in there stating if you sell before the 5 year term is up (on this particular mortgage) you would need to pay a % fee if sold. Don't think we will be selling before that time is up but its something for us to consider and have in the back of our heads.
That'll be the case on most (or all?) mortgages. Mine have always had a 2-3% early exit fee iirc. Often you'll be able to transfer the mortgage to a new property without paying this - your lender will confirm if that's the case. If not you would just need to make sure you time any potential move to complete just after your fixed term is up.
Right okay. Never purchased before so it's all new.
then the best advice I can give is read everything several times. If in doubt, ask a professional what a term/clause means and don't stop until you are happy you understand it. Make sure the solicitor in the contract requires of the seller all appliances, fittings and fixtures, internal and external, listed in the sale to be in good repair and full working order (so no dodgy oven, fridge etc) All ancilliary items to be provided for a functioning, livable property, (ie all taps, toilet cisterns, lightbulbs etc fitted and working) and written guarantees/warranties throughout, especially exterior cladding and weatherproofing materials like your roofs, flashings, render etc.
Then once it's all done and you've moved in start a slush fund and be disciplined about not touching it. You will need a reserve for when the boiler packs in, the roof leaks, the washing machine floods the kitchen etc etc.
Then once it's all done and you've moved in start a slush fund and be disciplined about not touching it. You will need a reserve for when the boiler packs in, the roof leaks, the washing machine floods the kitchen etc etc.