(… unless Law Commission’s exit fee report ends this income stream)
It is not often that you are made an offer that it would be simply madness to refuse, and it is a great shame for the elderly at Boughton Hall in Chester that it has come so late in their lives.
The 80 residents have been offered the freehold of their very upmarket retirement village set around a grade II listed hall, and they really, really REALLY should buy it.
The freehold is owned by Barnardos Developments Ltd which wants to sell the freehold for £950,000 to the Enterprise Property Group Ltd.
But first they have to offer the residents the right of first refusal. The deadline is February 4 for them to conclude the deal.
The properties at Boughton Hall are worth around £350,000 each and around eight a year – or 10 per cent – are sold every year, with exit and marketing for re-sale fees of 6.5 per cent.
That’s £182,000 straight off. Then there is the ground rent income of £350 a year, so approximately £28,000. The total comes in at around £210,000 a year.
Or an annual return of 22%. In less than five years, the investment pays off.
“This money could be used to sort out all the problems in the place or reduce the management charges,” says our Broughton House insider. “Sadly, too many residents just do not want to know, and the freehold will very likely slip through their fingers.”
Sadly, this happens again and again at retirement sites, as the house builders and analysts know only too well.
It is why LKP so applauds the residents of Woodchester Valley Village, near Stroud, for buying their site for £1 million and turning it into a mutual.
LKP is also full of admiration for retirement developer Bob Bessell, of Retirement Security Limited in Stratford upon Avon, who is leaving the freeholds of all his sites (around 4,500 flats) to the leaseholders in his will.
By buying the freehold, the residents of Boughton Hall would be paying their exit fees in advance. But they would also be securing this site and ensuring that the management is under their control.
Not buying the freehold, means it could be passed around to any commercial interest, which will make all decisions about management. In short, the residents will be utterly unempowered.
There will be no shortage of interest in an asset of this sort if the deal with Enterprise Property Group Ltd falls through.
One of the most assiduous buyers of retirement freeholds in the area is William Waldorf Astor, heir to the viscountcy and David Cameron’s brother-in-law. He trained under Vincent Tchenguiz, who once controlled one per cent of all the residential freeholds in the country, and buys through a well resourced, Chinese backed fund called Long Harbour.
Related posts:
Family outraged by £50,000 exit fee on sale at Retirement Villages’ Mayford Grange
Imperial Hall beats off £12,366 claim from Sterling Estates Management
Freehold sale withdrawn at Discovery Docklands East – once the residents were all set to buy
Last year: £64.8bn leasehold properties sold. £13.7bn was new-build. Leasehold house numbers double. Developers make £300-500 million a year from ground rent sales
Bellway offers young mother freehold for £3,750. But Adriatic Land demands £12,750 … then agrees to half the sum
Newcastle City Council reneges on allowing residents to choose management
Please ,Please Leaseholders, don’t let this opportunity to buy the freehold to slip away. Even if your children invest you will be safeguarding your and their future.
A company only invests in freeholds to exploit leaseholders. Why should anyone else be allowed to simply take money from you? Most likely, it will also end up being your money that is used to finance the purchase.
” All blocks of flats should be built with a residents’ management company controlled by the residents: those with the greatest financial stake in a block should be in charge from the start.”
LKP meeting at Westminster for Leasehold Reform .
The custom of freeholders selling on established Ground Rent titles where the majority leaseholders fail to take advantage of their right of first refusal , or where such sales have completed without prior knowledge of qualifying leaseholders [a criminal offence,], along with the custom of house-builders selling ground rent titles in uncompleted new developments, has seen a frenzied growth in the formation of freehold title purchasing companies.
This wild western dash for virtually ‘free land’ is fast becoming the preserve of unscrupulous individuals and groups keen to create a nest egg from ‘tenants’ drawn to their clutches. Stretching from South London to Southend and ever growing, this unregulated business has already turned into a multi-million pound freebooting industry that must be reined in and proscribed.
The financial terrorist activities of those involved beggar belief and are evident through the archives of the old LVT and successor the First-Tier Tribunal-Property.. Intimidation, harassment, and the constant over hanging threat of forfeiture, are the standard customs and practice of this evil trade.. LEASE, the ‘advisory’ service put in place by Government, and supposedly in part as a protective umbrella for leaseholders, lacks all clout and is reduced to simply providing sympathy with a smile and little else.
It is of prime importance that LKP, Sir Peter Bottomley, and Jim Fitzpatrick MP are successful in efforts to advance leasehold reform through the Housing Bill. And if the one target is only to outlaw growth in the Ground Rent sales business, the concurrent rampant progress of what is already a virulent form of Rachmanism.will finally be snuffed out.
And Boughton Hall: do not allow the opportunity to exercise your right to purchase your freehold to pass by default. Grasp it.
Various commitments have denied me responding until today,
To the Leaseholders at Boughton Hall, please please tell us you are purchasing the Freehold.
It is a golden opportunity that should never be refused.
The advice from Campaign against Retirement Leasehold Exploitation is second to none and any advice from regular posters such as Michael Epstein should never be ignored.
I could write pages of wonderful reasons why you should purchase the Freehold but LKP and MEs words sum it all up.
It is not hard to do by any means and once you own the freehold you can carry on with the same MA, if you want, or change when you want. YOU will be in control. No more mark ups on Insurance policies, repair contractors or even electricity/gas bills. No more ground rent.
NO thousands of pounds to pay the Landlord when the lease needs extending (YOU will be the Landlord)
This would benefit everybody in the long term, especially your families.
Get your families involved, they need to understand how important this is.
With respect may I just take the opportunity re an anomaly in the BH website, it states “As an owner of an apartment at Boughton Hall”. Hm, sorry but as it is no resident owns any apartment, or anything else at BH. So many people in leasehold incorrectly think they have actually bought a flat/house. The money you pay/paid is for a lease, a glorified rent book, that allows you access and to stay in the apartment. the shorter the lease the less value it is. When it is time to extend/renew the lease you will each have to pay the landlord thousands of pounds.
If you buy the freehold you will each not only own a share of each apartment but a share of the whole building.
Just buy the freehold and do nothing else if you prefer, but please buy it.
If anyone wishes confirmation of my knowledge and credibility please do not hesitate to contact Sebastian O’Kelly on LKP