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Independent - Britain to become a nation of renters
As opposed to what? A nation of leaseholders?

The most bizarre feature of the whole UK situation is that people mortgage themselves to own a lease, not a freehold.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Wed Jun 1st, 2011 at 08:10:45 AM EST
I have a friend who did that, worst of both worlds, with an interfering freeholder, and an inability to sell because the mortgage companys think that their is not enough time left on the leasehold (only sixty years!) to guarantee them getting their money back.

Any idiot can face a crisis - it's day to day living that wears you out.
by ceebs (ceebs (at) eurotrib (dot) com) on Wed Jun 1st, 2011 at 08:21:50 AM EST
[ Parent ]
Leasehold is another horrific aspect of the UK's housing market. Scotland did away with it, so should England. Oh wait, the owners wouldn't allow it.

You can have freehold on houses, it's very much worth paying the premium for and you really shouldn't buy a new house without one. It's very difficult to have freehold on a flat.

keep to the Fen Causeway

by Helen (lareinagal at yahoo dot co dot uk) on Wed Jun 1st, 2011 at 08:41:54 AM EST
[ Parent ]
Well, actually, what Scotland eventually got around to abolishing in 2002 - to the displeasure of the lawyers, who had been milking it for centuries -  was feudal tenure.

In England & Wales, Copyhold and other feudal arcana were done away with by the 1925 Law of Property Act which essentially replaced the lot with Freehold and Leasehold.

In Scotland leases do exist, but are limited to 20 years for residential (not commercial or agricultural) property, which means that they are entirely unfinanceable. That is something the government is aiming to fix shortly.

Then there's Crofting....

As for flats, there are various leasehold enfranchisement laws, and the almost entirely useless ('cos it was neutered by landlords) - but well-intentioned - Commonhold.

In the US there is of course the Condominium which is essentially a form of consensual Co-ownership based upon an agreement which was actually created in the first place by an innovative lawyer,  but 'which worked' so well it became codified and given statutory backing, State by State.

That sort of 'reality-based' approach - simply write the agreement, and see what happens - is essentially the approach I am taking.

My Community Land Partnership is just an agreement between stakeholders which brings in investors within a sort of Condominium agreement; creates an evergreen lease/right to occupy; and creates a sort of Real Estate Investment Trust (REIT) with Units redeemable in payment for rentals.

One could think of the outcome as direct investment in land rental value - or maybe as a loan to the land, rather than to the owner.

Anyway - the Community Land Partnership, is getting a lot of interest, and hopefully, a few prototypes not only for financing new build, but also for optimal funding of property, free of debt and compound interest, but with a return based upon the value of the location, and of the value invested in the location.

Watch this space.


"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Wed Jun 1st, 2011 at 09:56:45 AM EST
[ Parent ]

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