How much will my 79 yr lease affect the sale of my flat?

PJD

Jackie -

i'm going to hold off paying anyone to look into how much it'll cost to renew the lease, I reckon i'll be looking at around £500+.

I'm just going to try & sell the place. If it proves to be really difficult soley because of the lease, then I'll either drop the price or get a survey/quote on a lease extention.

One way of looking at it I guess is that if I did extend the lease I could maybe ask more money for my property.

It's a shame I didnt realise about this 80 year thing sometime before now. Typical

missk_ensington

So when did leases stop being 999 years???? My mum's a freeholder and the leaseholders at her properties all have 999 year leases!?! I thought that was the norm, to ensure the Freeholder would be dead if your lease ran out. I dunno, this doesn't make sense. If that's the case its like a business, if you bought a hairdressers say with only 4 years left on the lease you'd probably only give them £7,000 instead of maybe £50,000, so is the option not to reduce how much you're paying for it???

jackieblue

PJD - I understand completely your decision. One last question - how do you know you couldn't obtain the information for the same price I did (£49 plus £21 for expedition (ie, getting back to me the same day)). I had the info for the grand total of £70.51 to be exact.

Anyway best of luck with it.

Jackie

Worried

It's a sod isn't it? I feel for you in just missing out. It's typical of something that would happen to me! I have to say though that I think you'll find estate agents won't market your place for any less than they would a similar property with a 80 years plus lease, it's just if you hit a problem selling because people are more clued up then you're hoping, then you may have to reduce the price slightly. I think if you do find yourself in that position though, potential buyers are more likely to ask you to extend the lease rather than buy the property at a slightly cheaper price, as your buyer would have to wait until they had owned for 2 years before extending and thus would be facing a more expensive renewal because of the slight increase in the marriage value etc. If you do do find yourself having to renew, I think the marriage value would be minimal, as you are only just under the 80 years, but it all depends on whether the freeholder is a resonable person as to the price you get. You can contest it though. I think I would just get on with marketing the flat and see what happens, but that's just me and I don't know what your circumstances are. Keep us posted though!

PJD

Don't know when they stopped being 99 years. My lease is 20 years old, so it was at least 20 years ago

Yes, I can say that the price of the property is reflected by the current term of the lease MissK, but as Worried has pointed out, people would probably prefer me to rewnew the lease & pay a little extra than pay less & have the hassle & uncertainty (of cost) to renew the lease themselves. Possibly.

I don't know Jackie. I've only spoken to my stuck up managing agents who quoted me £350 (+ vat, + other charges, flannel flannel, waffle waffle, etc etc). I presumed they'd all charge the same. If I can get the info for £70 then I maybe tempted... - I could ring around for quotes when i get the chance. - Thankyou.

Thanks worried - yep, gonna carry on pushing the sale & see what happens! I'm sure all the joy i'm yet to have with future buyers, estate agents, solicitors, managing agents will cause me to create one or two fun-filled threads round this place

jackieblue

PJD,
Sorry I forgot you had already been quoted the £350 plus costs.
I wouldn't spend that kind of money until somebody asks the question either.
Fingers crossed they don't. It's not the end of the world.

If the question arises you simply say you haven't looked into the cost. In fairness if like me they really/need want to know then they could always pay to find out. At least if you don't know you're not lying by saying you have no idea as you haven't enquired.

Just make sure your EA doesn't make any quotes on your behalf as that's what happened with me and has really put my back up probably more than the actual cost.

Are there no other lessess in your block that have extended the lease recently ? You could make enquiries.

I wish you the best and hope I haven't worried you. I bought a flat some years ago and never even looked at/queried the lease period.

All the best and keep me posted. The other thing is - perhaps you need to up your asking price a little so that your buyers feel they could knock you down if necessary and really you won't have felt the drop ?

Miss_Penny_Pincher_2

missk_ensington wrote:

So when did leases stop being 999 years???? My mum's a freeholder and the leaseholders at her properties all have 999 year leases!?! I thought that was the norm, to ensure the Freeholder would be dead if your lease ran out. I dunno, this doesn't make sense.

Hi missk_ensington - the lease on our house is 700 years but I have heard of some leases on flats in London being only 7 years long!!! Does your mum make quite a bit of money from being a freeholder? I want to buy our lease to become the freeholder but don't have any idea how much it would cost.

cattie

missk_ensington wrote:

So when did leases stop being 999 years???? My mum's a freeholder and the leaseholders at her properties all have 999 year leases!?! I thought that was the norm, to ensure the Freeholder would be dead if your lease ran out. I dunno, this doesn't make sense. If that's the case its like a business, if you bought a hairdressers say with only 4 years left on the lease you'd probably only give them £7,000 instead of maybe £50,000, so is the option not to reduce how much you're paying for it???

It has always been common in London for leases to be 99yrs in length, especially on older properties. If the property is ex-council, then the lease is usually for a term of 125yrs.

Nowdays lots of newbuilds offer leases of 999yrs as the builders don't want the hassle of being a freeholder. They just want to build a development, get it all sold then move on to the next building project.

Doozergirl

I don't know how much the cost would increase by after the 80 years point and I remember one particular post which says that the cost suddenly shoots up, BUT the freeholder has an absolute minimum hold on the value of your property when they're only 6 months into the period which the law says they may have some kind of claim. Seriously, how far can your flat have devalued in 6 months?

As far as I remember reading, it's not a case that it increases by say 1% each year, it's more of a sliding scale where the freeholder is entitled to very little early on but gets bigger traunches as the number of years decrease. The only thing I can liken it to is the way that you pay off very little capital on a repayment mortgage in the early years, even though you might pay the same amount every month, iyswim.

PJD, you have to use a solicitor to sell anyway, so I think you should sort out who you're going to use and ask them to reassure you. Armed with your lease details they will have some idea of the price bracket you're looking at.

btw, I think it's a bad idea to overinflate your price. You need as many people through the door as you can get. The more people you have interested, the more chance you have of finding a buyer who doesn't mind!

PJD

Hi Jackie -

I was quoted the £350 by the current managing agents, but I am under no obligation to go with them. Anyone at all can do the work involved, - I'm glad I now ,now that it's possible for it to be done much, much cheaper

I actually live above a shop in a village, so it's actually a masionette - so nothing to compare costs to unfortunately.

Thanks for the assurance