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Leasehold vs Freehold: What’s the Difference?

liverpool estate agents

Purchasing a house is one of the most complicated and stressful events most people will go through in their lives. Often, the really important details get overlooked, as you focus on the big things like securing a mortgage. But at Mistoria, we pride ourselves on being proactive and making sure even the smallest details are taken care of.  

In recent years, you may have heard of the ‘Leasehold Scandal’. People buying properties did not realise at the time of purchase what they were letting themselves in for and did not fully understand the contracts they had signed.  But what is a leasehold and how does it differ from a freehold? Read this blog post to find out.  

Leasehold vs Freehold

In British law, there are two different forms of home ownership; freehold and leasehold. A freehold is what you’d probably expect when you purchase a house – once you’ve signed on the dotted line, all of the property is yours. This should always be the preferred option and if you purchase such a property, unsurprisingly you will not be affected by the leasehold scandal.

If you’re in the process of purchasing a leasehold property then you are essentially buying permission to occupy that property for a set number of years, usually a very extended period far beyond the life of the building itself. However, wew build properties on new estates seem to be increasingly providing only very short leasehold periods, causing problems for potential homeowners. 

Leaseholds may sound like a form of rent (and some do argue it is); traditionally leasehold rents are for a very long time, usually between 100 to 999 years, but the freeholder still has some responsibility for maintaining public areas around the property. So, for example, if you buy a leasehold flat the freeholder may be responsible for maintaining the staircases and lifts; typically the maintenance comes with a small additional fee.

On top of maintenance fees, the leaseholder also usually pays a ‘ground rent’ – literally a rent on the land the property is built on. It’s these payable rents where the scandal has broken out. For a long time, the rents were usually very small; some people would pay an annual ground rent of £1 a year and this is still very common.

But recently, some property builders have been discovering the law around leasehold is very complicated and massively in the favour of the freeholder, giving them leeway to increase ground rents without any say by the leaseholder.

In return, this has meant people are now paying attention to the fact their property is leasehold and discovering how this may impact them.

Check with Mistoria and we can advise

So, if you’re buying a house what should you do? Firstly there is no need to panic. It is worth noting that the vast majority of people who live in leasehold properties have not been affected by the scandal.

Nevertheless, make absolutely sure you know what you’re buying, check with us and we can advise you of the leasehold status of the property you are considering. Secondly, if it is a leasehold, ask for a copy of the lease and get it checked over by a lawyer that knows the area well. As a rule of thumb, any lease that is less than 80 years can start to significantly affect the value of the house, but it all depends on what is in the contract.

If you do buy a leasehold, it is often possible to buy out the leasehold at an additional charge and become the freeholder. Do this as soon as possible; the owners may be willing to sell it for just a few thousand pounds.

Property law in Britain is very old, some of the stories coming out of the leasehold scandal date the ownership of the land back to the 1600s which all means it is intensely complicated and hard to understand. However, the scandal hasn’t gone unnoticed by the government, and there have been promises of an inquiry. Whatever the results of this inquest are, there is enough political will in parliament for some significant change, although what and when that change will come into force is anyone’s guess.

If you have any questions, please do not hesitate to contact the team at Salford, Bolton and Liverpool estate agents, Mistoria, on 0800 500 3015. 

We are members of ARLA and NAEA Propertymark which means we meet higher industry standards than the law demands. Our experts undertake regular training to ensure they are up to date with best practice and complex legislative changes so they can offer you the best advice. We are also backed by a Client Money Protection scheme which guarantees your money is protected.

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New Services at our Bolton Office

bolton student house

Our popular Bolton branch is about to get even busier! Known for their attention to detail,  exceptional customer service and expert local knowledge, the team of property professionals at Mistoria Bolton are expanding their service offering. Although they are already known for their residential sales and lettings, consistently negotiating the best price for sellers and finding buyers their dream homes, they have recently introduced a new auction facility and have started handling commercial tenancies and HMOs. 

New Auction Facility  

In partnership with Pattinsons, the branch has now also launched a Modern Method Auction service facility. This comes with a number of advantages over the more traditional property sale method, including; your sale will be handled with no agency fee; you have the power to set your reserve price to get the price you want; a fast timeline, with both 28 and 56 day auction periods available; immediate exchange of contracts; and complete transparency. 

With an auction, the lengthy sales process, lack of buyer commitment, high risk of an aborted sale and no firm sale date, all well known pitfalls of the traditional sales method are avoided. You can find out more about the auction process here

HMOs

The branch has now also started to undertake work on every aspect of HMO ownership, from the initial purchase of the property, through renovation and conversion works, to the finding and vetting of suitable tenants. This type of property is particularly popular both amongst students looking to live with their friends during their time at university and young working professionals hunting for affordable accommodation. Given the plans for expansion at the academically excellent University of Bolton as well as the new jobs currently being created in the area, which are attracting a new population of young people, there has never been a better time to invest in a Bolton HMO property. For more information on the HMO opportunities offered by Mistoria, please visit our dedicated property investment website by clicking here

Commercial Tenancies

As Bolton town centre and the surrounding regions develop and thrive, the number of commercial tenancies the branch has been handling has increased massively. With the town set for further growth and expansion, the team is now calling on all individuals either looking to let or rent such property, whether it be office space, retail locations, industrial warehouses or leisure facilities, to get in touch.  

Talk to the Team

Whether you are a seller or buyer, investor or landlord, or you’re looking for a Bolton student house, please contact the team on 01204 800 766; they’ll be more than happy to answer any queries you may have. 

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Mistoria Estate Agents expands with launch of new Bolton office

estate agents north west

Mistoria Estate Agents, part of the Mistoria Group, specialists in residential and student property sales and lettings, is opening their third office in the heart of Bolton to cater for the growing demand they see in the area. This will be Mistoria’s third estate agency office in the North West following on from their first two locations in Salford and Liverpool.

The new office located at 21a Market Street, Little Lever, Bolton, BL3 1HH will serve the residential property market as well as offering lettings for students and professionals. Mistoria have operated from their Headquarters in Salford since 2009 and expanded initially into Liverpool three years ago.

Mish Liyanage, Managing Director of The Mistoria Group comments: “We have had a great 12 months and are now expanding our business into Bolton as we see great opportunities there for a quality supplier. Our new team has been carefully selected for their local knowledge and they are raring to go.”

“Since we began operations in 2009 we have seen continuous growth and this expansion into Bolton will not be our last. With our expertise in the North West property market, we’ve been able to concentrate on providing the key services that landlords, tenants and those looking to buy and sell their property really want. We’re excited about the future of the region and the great opportunities there are for us.”

With an opening offer to sell your home for just £750 the Mistoria team are competing against both traditional “bricks and mortar” agents as well as the newer online companies. Mish commented further “We have invested heavily over the last few months in our technology platforms and will market our customer’s properties through the market leading property portals such as Rightmove and Zoopla as well as through our own websites and traditional channels.”

The Bolton branch will be holding an open day to celebrate their launch where homeowners looking to sell their property, those wishing to buy or rent a home, as well as landlords searching for a local agent can come along and meet the team. Full details will be announced soon.

The Mistoria Group are high yielding student buy-to-let investment specialists, offering HMOs and armchair investments in the North of UK, generating combined net cash yield up to 13% (Rental and Capital Growth). For more information on the firm’s current available investments and the services it offers, visit us at www.mistoriagroup.com or email at info@mistoriagroup.com or call 0800 500 3015.

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Minimum Energy Efficiency Standards landlord advice

minimum energy efficiency standards landlord advice

The buy-to-let (BTL) market saw lots of changes in 2017 (taxation of BTL investments and portfolio landlord rules, etc) and there’s yet more regulation coming in 2018.

An Energy Performance Certificate (EPC ) tells you how energy efficient a property is and is rated from A (very good) to G (very poor). It goes without saying that the more energy efficient your property, the lower the energy bills and (usually) the better the overall condition of the house. A high EPC rating also restricts the amount of rent you can charge so keeping up to date with property maintenance work is a good incentive if you want to command the highest yields possible.

Furthermore, EPCs have been a mandatory document for any property rental or sale since 2007 and have a validity of 10 years. As the first of these certificates are coming up for renewal, even stricter energy regulations are being forced upon buy-to-let landlords.

As of 1st April 2018 the Minimum Energy Efficiency Standard (MEES) makes it unlawful to let out a residential property with an EPC rating of F or G (unless exemptions apply). From this date landlords cannot renew or grant tenancies on a property if it does not meet the MEES regulations. Beyond April 2023, the continued private rental of all buildings failing to meet the minimum standard will be outlawed entirely. Local councils will have the power to enforce compliance of the MEES, with penalties of up to £5,000.

The potential risk to landlords (if the property fails to meet MEES) is financial losses and the need to borrow more money to make necessary improvements.

You can view individual EPCs by just entering the property’s postcode here (England & Wales).

There are exemptions to the Minimum Energy Efficiency Standards for landlords, details of which (along with further information about the scheme) can be found on the Government website.

If you are a landlord and would like to explore energy improvements for your rental property, we’d be happy to help you. If you would like to discuss ongoing management of your property (portfolio), we would also be delighted to help. Please call us on 0800 500 3015 or email info@mistoria.co.uk.

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The number of people wanting to buy a house has fallen to the lowest level since mid-2008

The number of people wanting to buy a house has fallen to the lowest level since mid-2008 amid post-referendum uncertainty, according to the Royal Institution of Chartered Surveyors.

In its residential market survey, which has been carried out since the referendum, 27percent more surveyors polled said that house prices would fall rather than rise across the country in the next three months.

That dip in prices is expected to remain in London and the east of England for the next 12 months. This fall is not expected to be in the long term, however: those polled said that prices are still expected to rise over the next five years across the country, by an average of 14pc.

Simon Rubinsohn, the chief economist at Rics, said: “Rics data does suggest that the dip in activity will persist over the coming months, but the critical influence looking further ahead is how the economy performs in the wake of the uncertainty triggered by the vote to leave.

“Respondents to the survey are understandably cautious but with interest rates heading lower and sterling significantly so, it remains to be seen whether the concerns about a possible stalling in both corporate investment and recruitment are justified.’’

The survey said that there was the steepest fall in the number of properties coming to market ever recorded, with Northern Ireland the only place which bucked the trend.

It also reported that the number of agreed sales has fallen sharply since the referendum, because of sluggish demand and a lack of supply, due partly to a continued lull after stamp duty was hiked 3percent for investors and second home buyers. The south of England has been hardest hit, and this is expected to continue in the short term.

Lucian Cook, head of residential research at Savills, said: “The current month’s figures suggest countrywide impact on sentiment which is to be expected, however previous months’ results would indicate that a slowdown in London has been on the cards for some time.  It looks like the Brexit vote may be the trigger for this to materialise.”

Adam Challis, head of residential research at JLL, said: “It is encouraging to see the longer-term measure staying positive, suggesting any house price correction will be mild and short-lived.”

He added: “In London, the deeper impacts of Stamp Duty changes continue to dampen activity. This has more serious implications for desperately needed new build supply.”

Meanwhile, there are 8percent more new properties advertised to rent in the second quarter of this year, compared to the same period last year, according to the Rightmove rental tracker. This is as a result of the surge of investors buying properties before stamp duty for buy-to-let homes was hiked 3percent.

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Cross section of current properties for sale in Salford

Salford Properties For Sale

Introduction To Salford

Salford properties and the surrounding area offers everything to any single person or family unit; a business person, a family with either young or teenage children or couples wishing to start their new and exciting life together. Below is an overview of properties in Salford and this cross section of current properties for sale in Salford proves the fluidity and full lifestyle that this area offers.When searching for Salford houses for sale it is important to keep in mind that with the great tram, train and bus links, the whole of the UK is at your fingertips; when you reside in any of the available Salford properties, the bustling city of Manchester is only a small commute away.As well as the well established professional community in Salford, there are a wealth of beautiful green areas to enjoy either with your family or for a peaceful Sunday morning stroll alone. Salford offers fun for both ends of the scale by going from the green parks to the large cinema complexes and a wide variety of restaurants; The Salford Quays are definitely the place to be for a great night out with friends or for a first date.

The sizes and prices of properties in Salford range from multi-million pound abodes right through to a starter one bedroom flat; you simply need to decide which style of property will suit you and your needs and then use the contact details below for a overview of properties in Salford and to find your perfect new home.

Visit Mistoria Estate Agents For A Wealth of Current Salford Houses for Sale

By following the contact information below you can visit Mistoria Estate Agents for a comprehensive list of beautiful Salford houses for sale. They can guide you to the perfect property for you and your personal situation.

Address:
Mistoria House,
10 Broughton Rd,
Salford,
Lancashire M6 6LS

Phone:
0800 500 3015

Website:
https://www.mistoriaestateagents.co.uk/

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Increasing Sales in the Salford Area, Driven by the Increasing Success of Salford University attracting Worldwide Talent and Development

Salford’s popularity as one of the most cutting edge cities of the North West continues with yet another year of growth coming to its world-class university…

Every year, Salford welcomes the brightest and most diverse range of students who have chosen its university as their number one choice to study for a number of years. 2015 is no exception, and Mistoria Estate Agents have been able to report on the positive trends that are following the thriving city’s student culture in the residential sales sector. There are increasing sales in the Salford area with many students, graduates and families seeking to join the modern urban lifestyle that can’t be found elsewhere in the UK today.

What makes Salford buyers first choice? 

Salford isn’t just home to an additional 20,000 students in 2015. It’s also attracting families, businesses and as a result major investment. This investment can be enjoyed by all, as it’s essential infrastructure such as transport links – making the city accessible to all, keeping down traffic and congestion as well as offering residential occupants great ways to get about with variety from public transport networks to private transport facilities such as modern carparks with 24/7 security and lighting or rail connections offering fast, efficient services to all over the country. Salford has also attracted a wealth of former London offices and operations such as the BBC Media City at Salford Quays and many other TV network studios showing that large companies have seen the potential in Salford in recent times. Responsible for residential sales too are the great amenities Salford offers its tenants. The Trafford Centre is one of the UKs leading shopping destinations and is located very close to Salford granting world class shopping opportunities at their doorsteps. These are just a few of the biggest attractions students, families and businesses are coming to Salford for, and it’s been driving down the average price of family home down too as any estate agency in Salford is all but too aware of the situation!

How is this affecting the average price of family home?

The average price of family home in Salford is becoming more affordable as many developers and estate agency Salford such as the leaders at Mistoria Estate Agents are realising that they can offer more affordable and attractive accommodation to all of the groups that are flocking to Salford right now. All of the development by businesses and investment in Salford University is bringing an abundance of opportunity for students to learn and enjoy the city as well as long term prosperity to families who want to live the modern urban lifestyle. Residential sales in Salford are through the roof! The population is now approximately 230,000 and continues to grow due to increasing numbers of business employees seeking a second home and often attracting their families too. Why not find out for yourself what Salford can offer you.  With so much of the population contributing to its success as a residential haven offering the amenities of a world-class city nearby, you can’t afford to miss the latest opportunities from Mistoria Estate Agents. Why not check out the latest property offerings now online and contact one of our advisors who are expertly trained and experienced in the Salford area in aid of serving you and addressing all of your questions on this unmissable city.

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Impact on Salford Property Market with 20,000 Students Attending Salford University in 2015

The rising popularity of Salford University is having a significant impact upon the local area. As an increasing number of students choose to attend the university, there has been an understandable increase in demand for accommodation, particularly in those areas that are closest to the main campus.  The construction of the new building at MediaCityUK, which forms part of the College of Arts and Social Sciences, has also had an impact, with many students competing with media professionals for sought after accommodation in close proximity to the media complex.

High demand for accommodation

The level of demand for flats, apartments and houses is such that student accommodation doesn’t tend to stay on the market for long. Those who are seeking accommodation in the perfect location need to keep checking the Mistoria Estate Agents website. It should also be a priority to ensure that you are readily available, as viewing property quickly will enhance your chances of securing the ideal place. Finding properties is made easier by the Google-driven maps application on the Mistoria Estate Agents website, which allows you to search in specific areas of Salford. You can identify locations of interest and then browse relevant properties.

Searching for properties close to Castle Irwell

The self-catered halls of residence at the university have limited rooms available, which explains why so many students are competing for places within private accommodation. Many students do, however, like to be located close to the halls and those who opt to live close to the Castle Irwell Student Village are able to take advantage of the free bus service, with buses being provided every 30 minutes. There is also the opportunity to make use of the extensive sports facilities, while the concentration of students in this area has led to a proliferation of local shops and takeaways.

Key factors when making a decision

Location is clearly going to be central to your requirements. Most students tend to look for houses or flats that allow easy access to the campus, shops and entertainment. This means, however, that accommodation in prime locations is always in demand. But location isn’t the only factor when it comes to making a decision: the size and state of the property will also be important and your specific requirements may well be influenced by how many of you are planning on sharing. Agreeing to share with a larger group can result in lower rental costs for all of you, while also allowing you to obtain student accommodation that really stands out from the crowd.

When viewing property, think about the practicalities associated with your requirements. How well will the property meet your needs? The Mistoria Estate Agents website enables you to examine property details in advance, allowing you to narrow down possible options. It’s always advisable to view a property in person, in order to ensure that it meets the standards that you would expect.

To find out more about how to invest into the highest yielding property sector click here.