Extend Your Lease guide discussion

jop8383

we are trying to sell our flat that has 76 years left on the lease. We have priced it accordingly but are not having much interest. Do you think it would be worth starting the process of increasing the lease then putting the price up?

We have spoken to the freeholder who is a little vague and quoted 'about 10,000' but have not had any written quotes. Do we definately need a solcitor to extend lease and should we get that sorted or write to freeholder and request formal quote first? Would we need to pay the conveyers fees if we accepted the quote from the freeholder? Thanks
Jo

thingsarelookingup_2

As this is relates to a purchase not yet concluded I'll hold back from posting & post the outcome once its over!

want2bmortgage3

Hi, I live in a block of 6 maisonettes, it was built in 1980 with 99 year leases to each flat.

Each flat owner has to have their own buildings insurance (?) and pay a ground rent of £35 rising to £90.

Right now my lease is at 67 years and I know I should probably renew it, the last quote in writing I had was about £15000.

I read on the guide that the freeholder is usually responsible for buildings insurance, so why in this case does each tenant have to get their own?

Also for a roof problem who should be responsible? It is all so confusing and everything seems to be in favour of the freeholder!

tim123456789

want2bmortgage3 wrote: »

Hi, I live in a block of 6 maisonettes, it was built in 1980 with 99 year leases to each flat.

Each flat owner has to have their own buildings insurance (?) and pay a ground rent of £35 rising to £90.

Right now my lease is at 67 years and I know I should probably renew it, the last quote in writing I had was about £15000.

I read on the guide that the freeholder is usually responsible for buildings insurance, so why in this case does each tenant have to get their own?

Also for a roof problem who should be responsible? It is all so confusing and everything seems to be in favour of the freeholder!

The freeholder usually is respopnsible for insurance, but this isn't always the case, you are the exception.

And you (all the leaseholders) are jointly responsible for the roof repairs.

propertyman

want2bmortgage3 wrote: »

Hi, I live in a block of 6 maisonettes, it was built in 1980 with 99 year leases to each flat.

Each flat owner has to have their own buildings insurance (?) and pay a ground rent of £35 rising to £90.

I read on the guide that the freeholder is usually responsible for buildings insurance, so why in this case does each tenant have to get their own?

Also for a roof problem who should be responsible? It is all so confusing and everything seems to be in favour of the freeholder!

With maisonettes from the 70's and 80's , it is common that they have their own building insurance and are often responsible for external repairs e.g. to the roof.

In every case, while guides are useful, they rarely account for exceptions, so you start with the lease and see what applies in your case.

You can obtain it from HMLR if you dont have a copy- but be warned read it sitting down you may pass out with boredom

Bella56

Hi,
Possibly stupid question here. We are saving up to extend our lease, which is at 83 years until May. The lease extension calculator says that extending at 83 years will cost £2000-£3000, but at 82 years it raises to £3000-4000. Does anyone know if the cost goes up slightly each month, in which case it would only be slightly more expensive from June, or will it really raise hugely after we go from 83 years remaining to 82 years remaining?
thanks

B.

propertyman

The cost of extending takes a huge jump at 80 years as marriage value is taken into consideration, and the cost of extending becomes geometrically steeper.

The sooner it is done the better.

tim123456789

propertyman wrote: »

The cost of extending takes a huge jump at 80 years as marriage value is taken into consideration, and the cost of extending becomes geometrically steeper.

.

No it doesn't.

(Technically) Marriage value is always taken into accout but is assumed to be zero if the remaining lease is more that 80 years.

And marriage value at 79 years on "normal" properties will be minimal (less than a 1000) so there won't be a big jump, but a small increment.

Though what going from 80 to 79 years does do is give the FH the opportunity to argue over the marrriage value and leave you with the costs of a valuer to establish it.

tim

Bella56

We'll definitely have it done before it gets down to 80 years remaining. But what I'm wondering, is about how valuations work - say you are at the last month of 83 years remaining, if you had to wait another month, would it cost a tiny bit more (even though it was then 82 years remaining) or does the cost shoot up, year by year?

The lease extension calculator here comes up with £2000-3000 for extending my lease at 83 years, £3000-4000 at 82 years. I'm hoping to have enough money right after it ticks over to 82 years but am just making sure I won't lose out hugely by leaving it until then!!

tim123456789

Bella56 wrote: »

We'll definitely have it done before it gets down to 80 years remaining. But what I'm wondering, is about how valuations work - say you are at the last month of 83 years remaining, if you had to wait another month, would it cost a tiny bit more (even though it was then 82 years remaining) or does the cost shoot up, year by year?

The lease extension calculator here comes up with £2000-3000 for extending my lease at 83 years, £3000-4000 at 82 years. I'm hoping to have enough money right after it ticks over to 82 years but am just making sure I won't lose out hugely by leaving it until then!!

I think you did something wrong. The only variable part of the extension cost is the marriage value which is the same at 82 years as 83.

When you do get below 80 years it ought to change monthy (or even daily) but it is too difficult for simple online calculators to work in such increments so they round up/down to years. But TBH the whole process can be so time consuming/difficult that most people considering argueing over the final 200 quid is neither here nor there.

As to the marriage value itself it will go up by an average of 2K per year (full value with 80 year lease 150K, value with zero length lease approaching 0 pounds, divided by 80) of which you have to pay half so 1K pa. Though it is back loaded so lower pa at the start.