Cost To Extend Leasehold - Can You Negotiate?

big_leon

Hey all,
I own a leasehold property worth around £72,000. The lease was 99 years from 1st April1989 - meaning around 78 years remaining.... (Unfortunately I've only recently found out about the costs of extending a lease under 80 years )

Anyway, I contacted the Freehold managers and requested a quote. I had the following returned:

Current ground rent: £50
Proposal: To extend the terms of the lease to 150 years from original lease date 01 April 1989
Premium: £4260
New Ground Rent: £150 per annum and will double every 25 years
Costs: £500 legal costs + VAT & £30 Trustee fee

Now that's rather a lot of money (and doesn't quite match with the calculator on http://www.lease-advice.org/) -

Is this negotiable? Can I pose a counter offer?

Many thanks,
Leon

big_leon

A gentle nudge Anyone got any ideas on this?

Fire_Fox

You should be asking for an extension of 90 years with a peppercorn rent, which is what you have the legal right to and the LEASE calculator is quoting you for. The cost of extending a lease doesn't suddenly leap from £1K to £5K on the dot of 80 years so don't worry about that. Of course you can counter offer, they may refuse in which case you will have to serve formal notice in order to get your 90 years plus peppercorn rent for a fair price. The LEASE advice booklets on extending your lease are quite detailed, have you read them?

big_leon

Hi Fire Fox. Firstly thanks for taking the time to reply, it is very appreciated.

I'm just reading through the booklets now. I think I now understand that if they don't agree to my counter offer (i.e. which would be more like the figures quoted on the LEASE calculator) that I will have to serve the appropriate formal notice.

Is this something I can do myself or do I have to engage a solicitor?

Please excuse my ignorance in this, I'm learning on the fly!

Thanks again,
Leon

jodiesmitham

Hi there.

I have the same problem. I live in a 3 bedroom flat (woth around £150k now) and 77 years left on the lease. My landlord has quoted £28k to extend the lease to 99 years. Is this ridiculous or what? He thinks the flat is valued at £200k, but none of the flat on my road have gone for that. The last 3 bedroom flat sold 3 months ago went for £130!!

It wouldn't increase the value by very much, only the saleability.

Not sure what to do. If I go ahead and start this process, the quote may only decrease by a small percentage.

Any ideas if this is normal?