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Does this sound a good investment and is it worth buying the freeehold
Jim Jones
Posted: 19 January 2013 00:45:21(UTC)
#1

Joined: 19/01/2013(UTC)
Posts: 2

own a flat in a block of four all two bedroom apartments which i let out. It is a somewhat unusual lease as the leaseholder takes care of all the maintenance and insurance of their own flat as well as the outside grounds. There is ground rent goes up £275 every ten years which is a pain. One other apartment has come up for sale (with a garage) and is a very nice flat though the only difference to my flat it doesnt have central heating or a garden. It is reasonably priced and already has tenants in the flat and been offered the furniture etc and is in a good area. The Gross Yield is 9% and the Net Yield around 4%. All leases in the block have 950 years remaining on the lease.

Now,I am risk averse, is there any risk you forsee having two flats in one block. Secondly, I would have the option of purchasing the freehold as I will own 50% of the block. Is it worth spending thousands and thousands of money buying the freehold of a flat. Does it provide any real benefit

Secondly, with the freehold means more responsibilities and I guess hassle with dealing with the other two parties in the block.

Any advice would be welcome as just in two minds. I do want to buy the flat and just weighing up the pros and cons of purchase as well as the risk involved. Thanks
Clueless
Posted: 21 January 2013 11:09:23(UTC)
#2

Joined: 06/01/2012(UTC)
Posts: 17

Thanks: 1 times
Was thanked: 9 time(s) in 8 post(s)
Hi Jim,

IMO on having flats in two blocks Pros:

- Close to other flat so easy to keep an eye on and maintain both at same time
- Tenants will let you know if the other ones are being rowdy/damaging the property
- You already know of any problems with the buildings/ground so no surprises
- You know the figures and the area already

Cons:

- Fire/Flooding etc could hit both
- If the area goes out of favour or local rents fall you could be sitting on two reduced rents or at worse two empty flats
- If communal items need refurbished/repaired like the roof you will be hit with the bill twice

If there is no time limit on the offer of the entire freehold I would wait it out and see how things develop over the short, no point rushing it if still got 950 years as may bring extra hassle/work with limited reward.
Jim Jones
Posted: 21 January 2013 12:00:25(UTC)
#3

Joined: 19/01/2013(UTC)
Posts: 2

Thanks a lot for the message. It puts everything into perspective. Much appreciated.
Aaron
Posted: 15 February 2013 21:39:31(UTC)
#4

Joined: 15/02/2013(UTC)
Posts: 2

Hi Jim

Have you thought about investing your wealth overseas?
You can buy freehold plots in The Cayman Islands and through investing in Real Estate are eligible for zero taxation. No inheritance tax, no capital gains.

You should get in touch if you're interested.

www.alchemy-acquisitions.com

Lots of opportunities available
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