Property with a catch

[TheCountOfNowhere]

52 minutes ago, Frank Hovis said:

Amazingly the lease on the manor house sold at the next auction in April for £120k.

Still with the £30k annual ground rent payable to the council and the obligation to carry out renovations.

The seller will have lost a lot of money but has at last been given an escape route by a greater fool.

https://www.mirror.co.uk/news/uk-news/stunning-beach-side-manor-house-21816615

 

Shoulda read the documents.

[Frank Hovis]

25 minutes ago, TheCountOfNowhere said:

Shoulda read the documents.

I can see why they bought it though; I think the previous buyer's commenst upthread were along the line of what an amazing place it is and she couldn't believe that she had bought it for such a low price.

The new owner will be the same; for just £120k they can then drop into conversation / social media pictures of their seven bed manor house by the sea.  And for the first few months it will feel amazing to be able to walk around the house and grounds and say "this is mine".  Then the bill for £30k ground rent flutters through your antique wrought iron letterbox and you go "Oh.".

Financially it looks like a disaster but so does a rental property that @Wight Flight posted that was giving a 1.5% gross yield.

[TheCountOfNowhere]

29 minutes ago, Frank Hovis said:

I can see why they bought it though; I think the previous buyer's commenst upthread were along the line of what an amazing place it is and she couldn't believe that she had bought it for such a low price.

The new owner will be the same; for just £120k they can then drop into conversation / social media pictures of their seven bed manor house by the sea.  And for the first few months it will feel amazing to be able to walk around the house and grounds and say "this is mine".  Then the bill for £30k ground rent flutters through your antique wrought iron letterbox and you go "Oh.".

Financially it looks like a disaster but so does a rental property that @Wight Flight posted that was giving a 1.5% gross yield.

Cant lose on pwopatee.

[Frank Hovis]

6 minutes ago, TheCountOfNowhere said:

Cant lose on pwopatee.

Well if the currncy is going to be trashed as much as I worry that it might then that might unfortunately turn out to be true.

If some big inflation years turn that £30k into £10k (assuming no indexing) then that, against all common sense, becomes a good purchase.

[TheCountOfNowhere]

37 minutes ago, Frank Hovis said:

Well if the currncy is going to be trashed as much as I worry that it might then that might unfortunately turn out to be true.

If some big inflation years turn that £30k into £10k (assuming no indexing) then that, against all common sense, becomes a good purchase.

Again, we need to distinguish between inflation and wage inflation.

No wage inflation that £30K turns into £50K as your disposable disappears.

[Frank Hovis]

8 minutes ago, TheCountOfNowhere said:

Again, we need to distinguish between inflation and wage inflation.

No wage inflation that £30K turns into £50K as your disposable disappears.

Yes.

As I'm now "unwaged" that doesn't spring to mind as readily as it did.

[TheCountOfNowhere]

8 minutes ago, Frank Hovis said:

Yes.

As I'm now "unwaged" that doesn't spring to mind as readily as it did.

It's something people need to bear in mind.

 

All those buyers from 2005 onward have not seen massive wage inflation to help pay off their mortgage, let those enticed into the pyramid scam at the start did.  The price/wage inflation they have experience will at the very best make them as well off as they were but most likely worse off and struggling to pay those huge mortgages, the Coronavirus pay cuts might be the straw that broke the camels back. 

[haroldshand]

Much as I hate them, pays to have a good lawyer these days