House Buying: Renewing Lease with share of freehold

jangobob

Hello

We are first time buyers. We are currently looking at buying a ground floor flat that has a share of the freehold but has a lease of only 75 years. The freehold is shared with the owner of the flat upstairs flat.

I am wary of buying a flat with such a short lease incase there are problems extending it and am trying to get the present owners to do this before they sell. The estate agent is telling me that i dont need to worry about this and as we would have a share of the freehold it would be easy to extend and only cost legal fees. But then he would say that?

Can anyone advise me on how easy it would be to extend the lease?

Thanks in advance.

timmyt

He is right. You are your own landlord with the other tenant, and each of you is in the same boat.

But yes, the seller to you could instigate the signature from the other tenant of a Deed of Lease Variation, in case your co-freeholder is hard to get hold of.

Richard_Webster

If the seller won't arrange a lease extension with the other freehold you could reasonably ask why.

Try to contact the other co-freeholder to ask him his attitude to doing a lease extension. If he is uncontactable then you put the point to the seller to establish willingness.

I acted recently for someone buying such a flat and one of the co-freeholders was in Ethiopia (!) so the Transfer of the freehold had to be sent to her there for signature. My client had established e-mail contact with her and at my suggestion asked if she would sign for a lease extension. She replied that she would when she got back later this year but didn't realise that an extension was needed for a shared freehold! She was easygoing about it all but some people get a bee in their bonnet about not needing an extension and won't sign - so it is worth checking the point first - but as TimmyT says - even better to get the seller to organise it.

jangobob

Thank you both. The other freeholder shouldnt be hard to contact as she lives in the flat above, but the vendor has goven me the impression that she is difficult. If she didnt co-operate would it prevent the extension of the lease? presumably she would have as much say as I and we would both need to agree (and pay legal costs)?

Fire_Fox

Why are you contemplating buying a property where a person who has equal say over what repairs and maintenance get completed is known to be difficult? Are you going to take her to a Leasehold Valuation Tribunal every time? It is likely the situation has been underplayed by the vendor, if she refuses all reasonable repairs you could end up with property that is reducing in value and/ or is completely unselleable!

This explains your rights and responsibilities as regards leasehold or share of freehold, including extending the lease:
http://www.lease-advice.org/publications/

Richard_Webster

If she didnt co-operate would it prevent the extension of the lease? presumably she would have as much say as I and we would both need to agree (and pay legal costs)?

Yes it could prevent the extension as you would have to go through the statutory process (having waited 2 yaers to qualify) and you would effectively have to pay her half the lump sum that the LVT ordered.

So really best to get seller to organise it now.

Also if the person in the other flat is difficult you need to think very seriously about whether to buy the flat at all. A difficult other flat owner can be a nightmare further down the track and can make a sale almost impossible. Don't assume that legal remedies against the other flat owner will be easy to use or cheap.

jangobob

The seller has agreed to organize the lease extension on the basis that I will contribute to the costs (up to a limit). So hopefully this suggests the vendor is confident that the other freeholder will be co-operative!?

I dont know that the other freeholder/flat owner is difficult but am obviously wary and the vendor mentioned that she had some work done replacing a boiler and had a pipe fixed externally without consulting him.

Is it acceptable to go and meet the other freeholder to see what they are like? or is it bad form and should be handled through solicitiors?

Richard_Webster

Is it acceptable to go and meet the other freeholder to see what they are like? or is it bad form and should be handled through solicitiors?

In a case like this it is absolutely vital that you meet them so you can make your own assessment of what they are like.