rental houses

In the wake of Help to Buy, many builders began selling homes on a rental basis when homes had traditionally always been freehold. Over time, this became a contentious issue in which the Government felt the need to intervene.

Some of the nation’s homebuilders have been given the finger that they put profit before their social conscience, when they realize they need to build homes for families who also have shareholders to answer to.

Land Banking

The media had made it publicly known that there was a situation with the land bank.

Land Banking is a real estate investment scheme that involves the purchase of large blocks of undeveloped land for the purpose of selling the land at a profit when it has been approved for development.

Thanks to consolidation, some builders have inherited land in their organizations that is on a lease basis.

It is a moot point that they offer both leasehold and freehold properties for sale so buyers can make an informed decision.

What about the people?

Many people had felt that the market had moved too far toward rentals when the amount of profit builders had made on rentals came to light.

Matters came to a head when the CEO of one of the UK’s most prominent builders was awarded a bonus of over £100m. At the time, this was one of the largest bonuses paid in corporate history.

Some rental homeowners were shocked when they were quoted thousands of dollars in fees when they applied for permission to make modifications to their homes.

The commissions were collected by their Leasing Management Companies.

Some of the annual ground rents would double every ten years and homeowners could find selling their home in the future once these increases have been implemented would be more difficult.

in parliament

After notifying their MPs and having the issue debated in Parliament, the Government agreed that if you were buying a house (not a flat or apartment), then it is reasonable for you to own the freehold.

What can you do?

If you are in the situation of owning one of these houses and you did not know if it was a lease, then you should have reported it. If you believe that the attorney acting on his behalf did not provide you with all the facts about the lease you signed, you should immediately contact him again to investigate why.

You can contact the freehold owner at any time if you are interested in purchasing the freehold from him.

In addition to leases, there is the issue of service charges.

When Councils grant permission for Home Builders to build on the land, they do not always agree to adopt common areas as

• grass border

• Roads

That means maintenance in these areas must be outsourced, usually to a private company. Owners in the area then make a financial contribution to this maintenance work in addition to their council tax, this can happen whether the house is leased or free.

service charges

Service charge costs may increase. Sometimes area residents come together to form an association that allows them to choose a different service provider.

If you are considering buying a rental property, take the advice of your Lawyer regarding the rental.

It’s easy to get carried away with the excitement of buying a home, but you also need to realize that it’s a major investment decision that you need to think about carefully.