Important things to know when buying a leasehold property

Whether the infamous ground rent scandal would have occurred or not—a majority of the people are still gravitated towards buying leasehold property, and they are ready to pay the ground rent scandal in exchange for a leasehold property.

However, one of the most important aspects of buying leasehold properties is the timeframe before the annulment of the lease contract. For instance, you agree to a lease of 100 years with the landlord then, it is an indication that you are allowed to claim rights to the property for the 100 years.

However, if you are inclined to purchase a leasehold property from another party then, the duration of the lease is not resetted whatsoever. For instance, if the duration of the lease is remarked at 100 years and the current leaseholder has claimed its residence for 40 years then, you are claiming rights to the property for the next 60 years.

On the contrary, the duration of the lease might be creating a hurdle in dealing with mortgage or property sale in the long run. If the markup point of your leasehold is less than 60 years then, you would be required to depend on additional resources to get an approval for mortgage and other formalities.

Also, the considerable short timeframe of the lease will make it challenging for leaseholder to sell the property to a suitable buyer. However, if there is less than 80 years left on the contract then, the buyers might not show a suitable response to the offer—as it could get challenging for them to secure a mortgage on such property as well.

Also, you should not leave the service charges out from the picture. In a number of cases as a leaseholder, you might not be considered as an eligible contender for paying for the maintenance charges of the building or flat leased by you. The landlord or the owner of the property would be responsible for paying for such expenses but, you would be required to pay a fraction of the services fees.