Ground Rent

Dubsey

Hi all.

We are currently in the process of buying a house in Dublin. During the legal procedures it became apparent that the title was leasehold and not freehold as there is ground rent applicable.

The house still has 'good title' the estate agents keep telling us as it has still over 900 years remaining on the lease but I was annoyed to find out about it well down the road of the purchase process.

We have been trying to ascertain who the current owner of the lease is without much success but believe that we have tracked the company down and they are based in Dublin. The vendor is getting increasingly impatient and have gone so far as to apply to the PRA for the purchase of the lease and there would be a condition attached to the sale of the property that would transfer the ownership of the freehold to ourselves once this process has finished.

The problem is that, it looks increasingly like, we will have to make a decision one way or another before the lease issue can be resolved (I understand the PRA process can take up to several months). So, I have the following questions if anyone can shed any light please:

1. Does the current owner of the lease have a statutory obligation to sell the lease to us?
2. There are restrictions and conditions attached to the lease about modifying the property without the consent of the landlord. However, I have been told that there was an act that relaxed this?
3. Is there any way that I can work out what value the PRA would assign to the lease? As they have applied for it then surely there should be no costs for us?
4. What assurances should we look for if we were going to buy the property before the lease issue was resolved?
5. If the freehold can only be obtained by the owner of the house under the ground rents purchase scheme then surely if the vendor sells the house to us then the application is rendered null and void?

Many thanks for any replies.

D.

antoinolachtnai

You should ask your solicitor about this.

On the face of it, all these questions should have straightforward answers and the situation is straightforward, but you really need to get these answers from your solicitor.

Jo King

If there is a long lease there is usually an obligation on the owner to sell it. Without seeing the title deeds it would be unwise to give a definite answer to this. The matter is governed by the Landlord and Tenant Act 1967 and the Landlord and Tenant Amendment Act 1978 (NO 2). In the vast majority of long lease cases the owner is obliged to sell.

The costs are usually a multiple of the annual rent. I am not sure what the current multiple is. I think it was about 20 times the annual rent. It must be paid by the party acquiring the interest.

If the current lessee assigns his interest the application can continue with the new lessee.

The question of who should pay is a matter for negotiation.

Gamrab1974

I wouldn't be too concerned by the title being a 900 year lease. Thousands of houses in Dublin are held on such leases without any problem.

As long as there are no unduly onerous covenants it shouldn't make a difference. You solicitor should be able to advise as to what the covenants are.