Lease length on flat

monkey84

Hello,
My boyfriend and I are first time buyers and viewed a flat yesterday that we are interested in. The lease length on the flat is 73 years. The vendors have said they will extend this if we put in a good enough offer.
We are contemplating offering below the asking price (the property is currently priced above the stamp duty threshold) and telling the vendors we do not want the lease extended. We would then extend this ourselves when we came to sell the flat.
I am wondering if this is a good idea or not. The standard advice I have read seems to suggest that you should not buy a property with such a short lease length.
What would be the implications if we chose to extend the lease in 8/10 years time? Who would we need to speak to about this at the time - bank/solicitor/freeholder/all three? How complicated would it be? Would it be likely to be more expensive in the future than paying for it to be extended at the moment?
Any guidance would be much appreciated.
Many Thanks.

hazyjo

The longer you leave it, the more the cost generally goes up to extend the lease. I'd get them to extend it, but don't be blackmailed into giving a better offer because of it. Compare the price to what other similar properties nearby have sold for.

Jx

BitterAndTwisted

Yes, it will cost much more to get the lease extended later. The shorter the lease the more expensive it becomes.

monkey84

Thanks very much for the advice.

propertyman

Don't waste your time; if you contact your lender or broker they are highly unlikely to lend on a property with less than 80 year left on the lease.

If this is the property that you dearly want, the the vendors have to apply for the extension. The flat will therefore be worth more.

In order to decide what to offer for the flat now, and what the price for the extension is you need advice from a chartered valuation surveyor ( RICS member).

Unless the vendor is also the freeholder, or has a superior lease of a longer length, they cannot extend it; they have to apply for it.

Sensible_Jess

Hi
Just a thought - why don't you ask the vendors to write to the freeholder and get a quote for extending the lease? (don't accept any 'ballpark' figures, only written confirmation)

That way you'll know approximately how much money is involved. (and you're right; as the lease gets shorter, the costs will go up).

Also, have a look to see what has sold in the last few years in that area (I assume there are several flats in the area) Then go to the Land Registry website and for a nominal fee you can see the records for the sold flats, which will record how long the lease was on the properties that have sold.

Armed with this information, you'll be in a better position to judge the value of the flat. In my experience, EA's valuations on leasehold properties tend to not take in to account the length of the lease!
SOLD values, however, will be a better guide. Good luck!
S-J

Tr1pp

propertyman is correct, me and my OH were told by our advisor not to bother on properties with less than 100 years left on lease as the banks would not lend.

Get them to extend it...at their own cost...if you extend it at a later date it 10-20k.