I am currently in the process of buying a property with a 69 year lease. I know I will have to extend the lease before I can sell it but am unsure as to haow much this will cost.
Is it best to get a guarantee that I will be grated permission to extend and a quote of how much it will cost before I sign any contracts?
Does anyone know how much it might cost? The property is worth approximately £170000 if this has any relevance.
When we bought our flat, I put a quick call into the solicitor for the freeholder (I got the contact details through the management company)..
For us, it would be £2k + their solicitor fees, so around about £2.5k..
Reading other topics on here, it seems that some leases can be extended for very cheap & some are ridiculously expensive. If I can find the previous thread, then I'll stick on here the topic before about lease valuation tribunals..
Good luck, Becci
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I love the male body; it's better designed than the male mind. - Andrea Newman
thanks, that sounds about right from what I've read elsewhere but the freeholder has now offered to sell the freehold!
The current leaseholders were already in the process of applying to buy the freehold when we put our offer in and we heard today they have agreed a price of £12500 + £500 fees. This will be split between 4 flats. Does this sound like a good price?
Originally posted by Emma21: thanks, that sounds about right from what I've read elsewhere but the freeholder has now offered to sell the freehold!
The current leaseholders were already in the process of applying to buy the freehold when we put our offer in and we heard today they have agreed a price of £12500 + £500 fees. This will be split between 4 flats. Does this sound like a good price?
Emma - BUY IT. It's very cheap at the price with only 69 years left on the original lease.
You are never alone with a spilt personality - Spike Milligna (the late, great typographical error).
Originally posted by Emma21: thanks, that sounds about right from what I've read elsewhere but the freeholder has now offered to sell the freehold!
The current leaseholders were already in the process of applying to buy the freehold when we put our offer in and we heard today they have agreed a price of £12500 + £500 fees. This will be split between 4 flats. Does this sound like a good price?
You are never alone with a spilt personality - Spike Milligna (the late, great typographical error).
I'm in the process of buying a flat with 68 years left on the lease. The Freeholder has quoted me £30k to extend by 90 years, which is steep but as I'm in central London, pretty much par for the course.
However, we're only interested in buying the flat if we can completely modernise the interior (it needs it) and add a roof terrace, and for this, under the terms of the lease, we need Freeholder's consent.
I've spoken to him and and he wants to "wrap both things up at the same time", which suits me fine. However he wants an extra £5k for his consent to the alterations.
My questions are: 1) would I be better off trying to get him to sell me a share of the freehold? There is one other flat in the building, and the other leaseholder has been there for only about a year;
2) Is £5k a reasonable amount to ask for his consent to our alteration plans? I've searched extensively online but can't find any comparable scenarios with which to compare it, and my estate agent didn't even know he could charge for consent at all!
Pashmina... don't buy it. He's stringing you out for money. You should not have to pay anything just for permission to improve the place.
£30,000 to restore a 68 year lease to 99 years is excessive.
When you get to 50 years left and below, prices get silly, but at just under 70 years you should only be looking at a few thousand. As your Solicitor for an indication of what a reasoonable price would be.
If I extend my Lease from 80 years to 99, then I am looking at under £5,000 (estimate).
For an extra £30,000, you could buy a larger place, or a similar one with the improvements already done, or one with a long lease and have the money to yourself.
Walk away.
Ary.
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Strangely I'm not quite so worried about the £30k, as the property had been priced to reflect the need for extension at that kind of rate.
Round here anything under 80 years is a problem, and charging £25-30k for a 90 or 99 year extension (to take it up to 167 years approx) is seen as fairly standard, unfortunately.
The Lease Advice people (thanks to previous posts on this forum for the link!) have suggested that I get the current leaseholder to apply for a statutory extension anyway, which is apparently calculated according to a formula and would reduce my ground rent to £0. Yay!
I am much more concerned about the £5k he wants to charge for renovations, but understand I'm in a weak position because I'm not the property owner. My fear is that I'd end up in expensive and time-consuming litigation and/or LVT proceedings...
Anyone with similar experience who's able to comment would be most welcome!
I don't know where you live, but I live in Greater London. 70 years is the minimum Lease for Mortgage companies, and 80+ years recommended when purchasing.
I have never heard of anyone being charged for permission to modify a property they own by their Freeholder.
I think you are right in wondering what litigation and expensive problems your potential Freeholder is likely to throw your way.
Once you have been there, you will be entitled to purchase the Freehold at a reasonable price, but of course in the meantime you will have to put up with his demands... if it's a block of flats rather than a conversion, then you really are on the back foot when it comes to Freeholder demands for money, I am afraid.
Ary.
-------------------------------------- ***Do not, I repeat Do NOT feed the Trolls! *** *** All Hail the mighty hamsters! ***
Originally posted by Aryldi: I don't know where you live, but I live in Greater London. 70 years is the minimum Lease for Mortgage companies, and 80+ years recommended when purchasing. Ary.
The flat we are buying has a 69 year lease, and the 'N' B.S. said that was absolutely fine for them. In fact, the vendor is in the process of extending the lease anyway (and this was reflected in the offer we made) so we would have been OK regardless. But the 'N' B.S. never even asked.
Originally posted by Aryldi: Pashmina... don't buy it. He's stringing you out for money. You should not have to pay anything just for permission to improve the place.
Err. It's the creation of a roof terrace and it's normal for the freeholder not the leaseholder to own the roof. Therefore to gain use of the roof the leaseholder would expect to pay. It also extends the square footage of the flat so may involve a small increase in ground rent too.
That said, if there's a freeholder acting like this then it's definitely "buyer beware". A dispute with a freeholder can be costly, lengthy and can hamper the resale of the flat. I know all this as my previous landlord was in lengthly (over two years) negations over my landlords right to use a balcony. Basically the flat didn't have that right and the freeholder wanted paying to grant it. It's the price that couldn't be agreed. The freeholder was acting perfectly within his rights as it was the roof of the down stairs flat and therefore owned by the freeholder (who was a very nice and friendly chap by the way in case I've made him sound otherwise).
Once you have been there, you will be entitled to purchase the Freehold at a reasonable price, but of course in the meantime you will have to put up with his demands... if it's a block of flats rather than a conversion, then you really are on the back foot when it comes to Freeholder demands for money, I am afraid.
I too bought a flat though smaller and cheaper at 55000 in eastbourne in 2002. I enquiried immediately about extending the lease there and then and was told £5000. With only 67 yrs left i really had to do something. best thing is to rally the rest of lease holders and buy the free hold. Though this takes ages and costly, in the end you split all costs with fellow lease holders and guess what it cost us 195000 including legal costs that means 6500 each. now I own my free hold and instantly my property is worth alot more to me and I just extended my own lease to 999yrs. it takes time but you have the right good luck
The good news is that I've just found out the lease on the flat (which is in a conversion, one of three in the building) stipulates that the freeholder can only charge costs for giving his consent to work on the property, so looks like the £5k charge is out of the window thank god.
It's a very good point about the roof terrace though, thanks Fran - I'm going to take advice on that.
I've been taking some anyway and am going to get a leasehold valuation (unfortunately one of the other leaseholders hasn't been there long enough to apply for freehold apparently) and then get my vendor to apply for a statutory 90 year extension, which is calculated according to a set formula.
If the guy starts messing about then I'm just going to walk away. Some things are not worth the hassle.
I meant to add, my building society are fine with the lease being 68 years currently, as their lending criteria stipulates a minimum of 60, but they have advised me to extend it ASAP.
Once you have been there, you will be entitled to purchase the Freehold at a reasonable price, but of course in the meantime you will have to put up with his demands... if it's a block of flats rather than a conversion, then you really are on the back foot when it comes to Freeholder demands for money, I am afraid.
What difference does it being a conversion make?
I have no idea
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Once you have been there, you will be entitled to purchase the Freehold at a reasonable price, but of course in the meantime you will have to put up with his demands... if it's a block of flats rather than a conversion, then you really are on the back foot when it comes to Freeholder demands for money, I am afraid.
What difference does it being a conversion make?
I have no idea
You wrote:
if it's a block of flats rather than a conversion, then you really are on the back foot when it comes to Freeholder demands for money, I am afraid.
Which seems to indicate there is a difference between a block of flats and a conversion when it comes to Freeholder demands for money. I'm just curious as to what you meant.
All Hail the mighty hamsters! 
