Older Terraced Houses in Central Eastleigh

Some of the older terraced house in the centre of Eastleigh are leasehold.   There's a bit of history and an explanation below.

Eastleigh did not  really exist as a town until the railway came and the railway works were later built.  The mainly terraced houses in the centre of the town were built from about 1880-1910 to house railway workers.    In most cases a land owner granted a lease for 999 years of a number of neighbouring plots to a builder who then built the houses.   The ground rent payable for each plot was about £3 per year, which at that time was a useful income!   Each house would have been rented out on a short term tenancy to a family.

Eventually the individual houses were sold and the buyer took over the 999 year lease (or part of it) for that particular house.   It ceased to be financially worth while to collect the ground rent some time ago, and so in many cases the freehold was sold to the lessee.   In some cases the freeholder was old and could not be bothered to collect the ground rent.   Once he or she died, the family could not be bothered either, and contact was often lost.   Even if a lessee wanted to pay the ground rent it was often difficult to find the freeholder.   Because of all this there are three situations that can apply to one of these houses:

  • It is freehold, because the freehold has been purchased at some time in the past.

  • It is leasehold but the freeholder can be contacted.   (In these cases it is usually possible to buy the freehold for an outlay of £600-£900 including legal costs of the your solicitor and freeholder's solicitor).

  • It is leasehold but the freeholder cannot be found.  (Because the seller has never been asked for ground rent we often find that he does not realise his property is still leasehold).  Once you have lived in the house for 2 years as lessee you have the right to buy the freehold.   The difficulty is that you have to serve an application on the freeholder and if you do not know who he is, the costs involved in getting court orders to get round this, make the whole exercise unreasonably expensive.  

In most cases not having the freehold is not a big problem in practice.  One thing that does crop up is that many leasehold properties are registered at the Land Registry with what is called "Good Leasehold" Title which is technically not quite as good as the more normal "Absolute" title.   The difference is pretty theoretical in case of these properties, but unfortunately the Council of Mortgage Lenders' Handbook (which sets out the detailed points solicitors have to check) is ambiguous as to whether this kind of title is acceptable.   This often means that a seller has to pay for an insurance policy costing about £50-£150 to protect the buyer and his lenders against the risks that are thought to exist.

If you instruct us to act for you on a sale or purchase we can explain further what is involved and deal with these issues for you.    A lot of solicitors automatically charge an extra £100-£200 just because the property is leasehold.   This is understandable for flats where there is a lot more work, but for houses where there is no service charge etc, it is not appropriate, because the extra work is much less.   We do not make any extra charge for typical older house with a long leasehold title, so you may wish to Get a Quote from us to deal with a sale or purchase of such a house, or Contact Us.  Our Local Knowledge is useful and can avoid problems if you are selling and you ask us to Arrange a Home Information Pack.

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