Short Lease and other queries

seven-day-weekend

Hi

My husband and I have hopefully sold our Spanish house and intend to buy a property in the UK.

We have seen a flat, in a devlopment we know well. It was built in the late 1950s and therefore has a short lease of less than fifty years. It also needs all new windows and new flooring and the kitchen and bathroom need to be replaced. Also it has no garage, which most of the other flats have.

It is quite a good size two-bed flat in a nice area and we don't mind doing the work.

My main enquiry is about the lease. It is about £10k to renew the lease. If we don't renew it, what happens when the lease runs out? I know that if we ever want to sell it the short lease will make it difficult to sell to anyone who needs a mortgage. What other implications of the short lease might there be?


I can't give a link as I can't appear to find the property on the internet! But I have found a link to another flat in the same development, which is similar apart from having new windows and carpets. The flat we are interested in has an asking price of £72k. What price might be reasonable to offer?

http://www.rightmove.co.uk/property-for-sale/property-27012292.html

We are in no rush to buy anything.

Your comments and advice appreciated.

dippy

Are you aware that a lease only gives you the right to live in the flat until expiry? You don't actually own anything physical, not the flat, not the interior, not the windows, not the floorboards, not the ceilings, not the walls, nothing, nada, zip.

When the lease expires, you cease to own the right to live in that flat and possession of the flat reverts to the owner of the freehold.

As the lease nears it's expiry date, its value actually diminishes as you're actually only buying the right to live in the flat until the expiry date.

seven-day-weekend

Thankyou, yes I was aware of that. We are in our 60s so we will probably 'expire' before the lease does! So basically we would be buying the right to live in it for fifty years.

What is more important -the value of the flat is diminishing also, yes? And that also if we wished to sell on it would be difficult for anyone who needed a mortgage.

chappers

£10k to renew the lease seems cheap, currently the property is borderline mortgageable as most lenders require term plus 30 years.
How much would it be worth with a new 99year lease.
You say you will probably expire before the end of the lease so are quite happy to pay the price to live there for 50years, but consider the fact that your circumstances may change and you may find yourself needing to sell in the future, also do you have anyone you may wish to leave the house to when you die.

devotee

OP the flat in your link has 91 years of unexpired lease? Why just not buy this one instead?

Seeing that the flat you want to buy is only 2k cheaper, then ask the vendor to extend the lease (start the process) as if the info is correct then the flat is way overpriced.

devotee

Here's another one
http://www.findaproperty.com/displayprop.aspx?edid=00&salerent=0&pid=9142940
http://www.findaproperty.com/displayprop.aspx?edid=00&salerent=0&pid=8461253

seven-day-weekend

devotee wrote: »

Here's another one
http://www.findaproperty.com/displayprop.aspx?edid=00&salerent=0&pid=9142940
http://www.findaproperty.com/displayprop.aspx?edid=00&salerent=0&pid=8461253

We are viewing the first of these properties tomorrow.

The second we have looked through the windows and the communal areas. The communal areas are scruffy and the kitchen is small (the size of the kitchen depends upon whether it is at the front or back of the property, they vary). So we have discounted that one.

Thanks for the tips!

seven-day-weekend

devotee wrote: »

OP the flat in your link has 91 years of unexpired lease? Why just not buy this one instead?

Seeing that the flat you want to buy is only 2k cheaper, then ask the vendor to extend the lease (start the process) as if the info is correct then the flat is way overpriced.

We were only going to offer about £60k, although as I did not realise the other flat had a longer lease, we will certainly make an appointment to view, thanks! (** Edited to add, same day: have now contacted the EA and am awaiting a reply.)

We were initially only looking at ground floor, but have now decided to look at the upper flats too.

seven-day-weekend

We have decided to either buy a flat with a lease already lengthened, or buy really cheap and extend the lease ourselves.

Thanks all for your advice.

seven-day-weekend

I will keep the thread updated about viewings. Thanks once again!

seven-day-weekend

http://www.findaproperty.com/display...=0&pid=9142940

We have viewed this flat, it is lovely, and has all the kitchen appliances, curtains and carpets too. 60-year-lease according to the EA. He says he has a copy of it, so we can check that out.

The flat needs hardly anything done to it, just tweaking. It has been for sale for over a year, price has recently been reduced.

Let's hope it stays unsold now until we are in position to make an offer!