robski
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Post by robski on Sept 18, 2018 12:56:33 GMT
Depends on the terms of the leasehold. The issue the government is tackling relates to modern leaseholds where the terms allow for disproportionate & arbitary uplifts in ground rent & extortionate buyout clauses. This gives the freehold a significant value. If this isn't the case then ISTM the freehold value is very minimal over & above the leasehold as it's merely a peppercorn rent. (Note different to the premises lease value) Well I have actively avoided any leasehold property all my life - as did my father before me - and we were not alone. Whether the value attributed to a freehold property above a leasehold property is large or small may depend on the terms of the lease (and critically it's remaining duration) - but there will always be a difference. There has been, and still is a very real perception that freehold will always trump leasehold - and that manifests itself in leasehold being valued at a discount to freehold. That has been the case for a very long time and you will not convince me (or a large part of the population I suggest) otherwise - but I'm sure MT will be interested in your musings!? And also, that in residential houses there is little point in them being leasehold for any other reason than to maximise developer profit by being able to sell them on. However the problem is not just the ground rent, but that typically you also need to apply for permission to change things, which... for residential flats its in the flat owners benefit typically for them to be leasehold, as that means there is someone who has to accept changes and ensure that costs are shared etc. Where as for a house its a bit odd since something like a roof repair will not need to be shared.
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withnell
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Post by withnell on Sept 18, 2018 12:57:12 GMT
Pretty sure that you instruct the valuer to provide valuations on a specific basis, ie you'd ask for a leasehold or freehold valuation. They normally have caveats about how you should ask your solicitors to confirm the structure!
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GeorgeT
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Post by GeorgeT on Sept 18, 2018 13:21:43 GMT
A very long leasehold interest, i.e 999 years, with a fixed low ground rent may be described as a virtual freehold and in valuation terms there may be little difference - although a freehold interest is always preferable because you do not have anyone above you with a superior interest to whom you must pay ground rent and defer.
In simple terms, a leasehold interest in property is a wasting asset. The length of the remaining term is critical and of course it gets shorter and shorter with each day that passes. While it is usually possible to extend , this can come at a considerable cost.
Freehold is always king, always more attractive to purchasers, always simpler ownership.
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ilmoro
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Post by ilmoro on Sept 18, 2018 13:22:19 GMT
Ha, I'd forgotten about that. Wonder who prompted that update 😉 Suffice to say my musings weren't just random thoughts. So less than 2.5% variance in value at best But more like double that variance in sale price, distressed or not. I'm not sure I give much weight to a VR that contains such a howler (I can hear ozboy ) Double that variance! 20x variance. But then that isnt the issue being discussed. The discussion is whether the error in providing a FH rather than LH was significantly misleading and clearly based on the numbers it wasnt particularly significant therefore any compliant on that grounds seems weak. A compliant against the valuer on the basis that his valuation is twice what it sold for, thats a whole different ballgame. Lets wait and see how this one comes out overall, current potential capital loss is c12% based on the various sums quoted from several sources.
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johni
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Post by johni on Sept 18, 2018 13:32:34 GMT
Your guess is totally wrong I am invested here and have been in other defaulted loans. The difference is I wait for the full facts which we have clearly been told will be released when the administrators have completed their work. We have not lost any money on this loan as yet and we do not know how Moneything will deal with the issues raised in this thread which there are several. But going out of your way to continually try to damage the reputation of any company without waiting to find out the facts ie in this case if a loss has occurred after recovery. What actions are taken regarding the difference in valuation in freehold and leasehold. Whos error was it the valuers solicitors or Moneythings. If these issues are not dealt with then I will be following this up. But I will collect all the facts to be able to asses the actions necessary. johni: When a see a car crash approaching (or actually in motion - as here) I don't actually have to hear the crunch of tearing metal and see ripped flesh to predict a likely outcome. You may be the type to sit quietly by not wishing to rock the boat whilst the good folk at MT look after your best interests (like the did at COL for example) - but I'm not. Furthermore, it does no harm to us lenders whatsoever to remind the platform (regularly) that they are being kept under close long-term surveillance. How did that maxim by Edmund Burke go - 'The only thing necessary for the triumph of evil is for good men to do nothing'. I'm clearly not suggesting 'evil' is being perpetrated here - but I'm sure you'll get the general drift? Once again how wrong you are. I do not make wild accusations I follow the facts put the questions to the relevant parties and follow the complaints procedure to the letter. Comparing Collateral who deliberately misled investors claiming to be FCA regulated and Moneything is totally wrong. You may not be claiming evil here but your comparisons are. False representation or accusations are expensive in court.
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dovap
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Post by dovap on Sept 18, 2018 14:48:25 GMT
But more like double that variance in sale price, distressed or not. I'm not sure I give much weight to a VR that contains such a howler (I can hear ozboy ) Double that variance! 20x variance. But then that isnt the issue being discussed. The discussion is whether the error in providing a FH rather than LH was significantly misleading and clearly based on the numbers it wasnt particularly significant therefore any compliant on that grounds seems weak. A compliant against the valuer on the basis that his valuation is twice what it sold for, thats a whole different ballgame. Lets wait and see how this one comes out overall, current potential capital loss is c12% based on the various sums quoted from several sources. be no complaint if they were so compliant the update of 28th re value of lease vs free only seems based on an 'understanding' lazy language or just cba to actually check properly still and be definitive ? with most things these days relating to p2p I'll see what actually rolls up rather than whats said
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ozboy
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Post by ozboy on Sept 18, 2018 17:15:22 GMT
Ha, I'd forgotten about that. Wonder who prompted that update 😉 Suffice to say my musings weren't just random thoughts. So less than 2.5% variance in value at best But more like double that variance in sale price, distressed or not. I'm not sure I give much weight to a VR that contains such a howler (I can hear ozboy ) One day, Investors will look back aghast and wonder how on earth The Great VR LTV ScamCon lasted for so long, with such impunity.
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sqh
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Post by sqh on Sept 18, 2018 18:36:21 GMT
Ha, I'd forgotten about that. Wonder who prompted that update 😉 Suffice to say my musings weren't just random thoughts. So less than 2.5% variance in value at best But more like double that variance in sale price, distressed or not. I'm not sure I give much weight to a VR that contains such a howler (I can hear ozboy ) I agree, It's fairly clear from the VR that a degree of hope value is built-in to the valuation. The VR talks about the plans for demolition and redevelopment, and compares the value of other flats in the area based on redevelopment. That hope value is worthless without Freehold title. To then say that there is only a small difference in value between the LH and FH is nonsense, given the circumstances. Perhaps, MT should have bought the Freehold if it was so cheap.
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rxdav
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Post by rxdav on Sept 18, 2018 18:42:54 GMT
But more like double that variance in sale price, distressed or not. I'm not sure I give much weight to a VR that contains such a howler (I can hear ozboy ) I agree, It's fairly clear from the VR that a degree of hope value is built-in to the valuation. The VR talks about the plans for demolition and redevelopment, and compares the value of other flats in the area based on redevelopment. That hope value is worthless without Freehold title. To then say that there is only a small difference in value between the LH and FH is nonsense, given the circumstances. Perhaps, MT should have bought the Freehold if it was so cheap. Excellent post sgh - love the concept that if the freehold was so cheap (with (alleged) consequent minimal differentiation between FH and LH value)) that MT could/should have just bought it outright - seems they missed a trick there eh!?
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Post by Badly Drawn Stickman on Sept 18, 2018 19:45:25 GMT
I agree, It's fairly clear from the VR that a degree of hope value is built-in to the valuation. The VR talks about the plans for demolition and redevelopment, and compares the value of other flats in the area based on redevelopment. That hope value is worthless without Freehold title. To then say that there is only a small difference in value between the LH and FH is nonsense, given the circumstances. Perhaps, MT should have bought the Freehold if it was so cheap. Excellent post sgh - love the concept that if the freehold was so cheap (with (alleged) consequent minimal differentiation between FH and LH value)) that MT could/should have just bought it outright - seems they missed a trick there eh!? Is this not the loan where the freeholder was deceased or at least missing in action, or am I confusing it with another bad dream.
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johni
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Post by johni on Sept 18, 2018 19:46:41 GMT
Once again how wrong you are. I do not make wild accusations I follow the facts put the questions to the relevant parties and follow the complaints procedure to the letter. Comparing Collateral who deliberately misled investors claiming to be FCA regulated and Moneything is totally wrong. You may not be claiming evil here but your comparisons are. False representation or accusations are expensive in court. So you were fully aware that COL were about to shaft lenders before it happened then - pity you didn't let the rest of us know in advance. My point being (as it seems for you it needs spelling out in simple terms) is that everybody though COL was a great team - before it all went belly-up - but somehow (for you) MT is the antithesis and to be totally trusted - and why might I ask? ' As for 'False representation or accusations are expensive in court' - do I detect a 'threat' - what a hypocrite you are (see your earlier post to me)!!
Tell you what - you just sit there quietly simpering and feigning self righteousness and let the big boys and girls fight the battles for you - seems it was ever thus.
My point about court was not a threat I felt your comments were close to the mark of outright accusations if a companies reputation is damaged then that's where it will end up. I don't need people to fight my battles I have been to the FCA I know the procedure I also know the time to move Is when you have facts otherwise you are wasting your time. Your assumptions about collateral again are wrong. In P2P you dont go in without having your eyes wide open. There are massive failings which need addressing VRs are the prime example. My point is I wait for full facts and act not act without ffull facts.
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johni
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Post by johni on Sept 18, 2018 19:47:19 GMT
Excellent post sgh - love the concept that if the freehold was so cheap (with (alleged) consequent minimal differentiation between FH and LH value)) that MT could/should have just bought it outright - seems they missed a trick there eh!? Is this not the loan where the freeholder was deceased or at least missing in action, or am I confusing it with another bad dream. Yes correct
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johni
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Post by johni on Sept 18, 2018 21:02:01 GMT
My point about court was not a threat I felt your comments were close to the mark of outright accusations if a companies reputation is damaged then that's where it will end up. I don't need people to fight my battles I have been to the FCA I know the procedure I also know the time to move Is when you have facts otherwise you are wasting your time. Your assumptions about collateral again are wrong. In P2P you dont go in without having your eyes wide open. There are massive failings which need addressing VRs are the prime example. My point is I wait for full facts and act not act without ffull facts. Now that's a bit more like it johni - seems there is a bit of spine there if the correct buttons are pressed? However, you are now making statements which make you look naïve - 'My point is I wait for full facts and act not act without ffull facts ' (I'll spare you the English lesson) - you will never know the 'full facts' in advance of taking action - it's the nature of the beast. The best you can usually do is to act in good time and good faith armed with the facts that are available at the time action becomes a perceived necessity (a judgement which cannot always be totally objective). Otherwise you will just vacillate and prevaricate endlessly (waiting for the 'full facts') - until the game is over and you then belatedly wake up to find both players and spectators have already gone home!
'There are massive failings which need addressing VRs are the prime example.' - on this statement we can fully concur.
Throw your insults as much as you want you know nothing about me. I do know you like to repeatedly make accusations which you claim are fact which at best are guesses. But hay if thats what floats your boat. Enough said from me more important things in life.
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boundah
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Post by boundah on Sept 19, 2018 13:39:08 GMT
Now that's a bit more like it johni - seems there is a bit of spine there if the correct buttons are pressed? However, you are now making statements which make you look naïve - 'My point is I wait for full facts and act not act without ffull facts ' (I'll spare you the English lesson) - you will never know the 'full facts' in advance of taking action - it's the nature of the beast. The best you can usually do is to act in good time and good faith armed with the facts that are available at the time action becomes a perceived necessity (a judgement which cannot always be totally objective). Otherwise you will just vacillate and prevaricate endlessly (waiting for the 'full facts') - until the game is over and you then belatedly wake up to find both players and spectators have already gone home!
'There are massive failings which need addressing VRs are the prime example.' - on this statement we can fully concur.
Throw your insults as much as you want you know nothing about me. I do know you like to repeatedly make accusations which you claim are fact which at best are guesses. But hay if thats what floats your boat. Enough said from me more important things in life. Now, now johni & rxdav - I know we're all getting jolly cross about valuations (or whatever it is you're arguing about), but maybe it's time to settle down with a nice cup of tea and a copy of Gardeners' World?
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elliotn
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Post by elliotn on Sept 19, 2018 14:20:34 GMT
I’m sure it wouldn’t meet the regulatory threshold (there to prevent the frivolous) but I certainly incurred losses on this loan because the platform broke their then T&Cs by not keeping lenders up to date with progress on claiming late payments. I wasn’t even aware the borrower had never made a single payment as I continued to make purchases in a non-performing loan. That was MT’s choice not to inform their lenders. Weren't the terms and conditions regarding non-performing loans added after this loan went under? As far as I can see any claim will fail. No. Their original T&C obliged them to keep lenders up to date as to the progress of reclaiming late payments (something like 12.5 but can’t be ars’d to look). Except in this instance never even told us there was a missing payment, let alone several. As far as I can see such a claim would be perfectly reasonable based upon the breach of their own T&C and conscious negligence towards the risk borne by lenders, if ultimately futile.
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