Extend Your Lease guide discussion

tim123456789

wwarby wrote: »

Hi experts,
The development in which my flat is situated comprises over 100 flats and obviously all the owners will be in exactly the same position, so I'm wondering if there is any scope for us to all club together and negotiate a better price either on the renewal itself or on the legal fees if we used a single solicitor for everyone's renewal.

I'd like to know if such an arrangement is (a) possible (i.e. would the freeholder or solicitors be willing to negotiate a reduced price for a large group of leaseholders) and (b) advisable (i.e. would the savings justify the work that would likely ensue from trying to get other leaseholders on board).

Yes there is.

Perversely (assuming that you are so entitled) it will usually, cost you less (per flat) to enfranchise the block than to extend a lease.

But you'll need 50% (plus 1) of tenants in agreement to do this, and of course, the ones who do join in will have to pay for the ones that don't (but will have the benefit of getting their ground rent and extension money when they do extend)

tim123456789

joepineapples wrote: »

Hi there I hope someone on can here can help me with advice.

I have 72 years left on my lease so I have begun to look into extending it. I have not engaged a solicitor, although I have chatted to one, getting some informal advice.

I have firstly written to the freeholder and proposed a 'voluntary' extension as I understand this is the cheapest way to do it. They have they come back to me and said I need to pay their surveyor £780 (inc. VAT) to value the lease. From the guidance on here, I understand this to be normal. I assume they will then come back with a price for extending.

I'm a little confused as to the steps after that. If I reject their valuation, could someone advise how I then negotiate? Will I then need to pay for my own surveyor for a second opinion or do I just ask a solicitor to negotiate for me?

If I agree with the price, do even need a solictor or do I just pay the money?

Any advice appreciated. Thanks

If you are not using the statutory process you have no "rights" to negotiate as there is no way to force the LH to sell to you so they will just say "take it or leave it"

IMHO you would be foolish not to use a solicitor (agreed price or not). YMMV

tim

J_Stockwell

This guide is great for those with uncooperative landlords and other leaseholders. However if you are in the lucky situation of all leaseholders agreeing that they want a lease extension (along with amending the ground rent to a peppercorn rent), and those same leaseholders owning the freehold between them so that the freeholder is in agreement with extending the leases, then is there a simple way of doing this themselves or must a solicitor be hired to carry out these amendments to the leases? As all parties are in agreement, there will be no requirement for obtaining or paying a "marriage value", just changing a couple of clauses in the leases.

tim123456789

J_Stockwell wrote: »

This guide is great for those with uncooperative landlords and other leaseholders. However if you are in the lucky situation of all leaseholders agreeing that they want a lease extension (along with amending the ground rent to a peppercorn rent), and those same leaseholders owning the freehold between them so that the freeholder is in agreement with extending the leases, then is there a simple way of doing this themselves or must a solicitor be hired to carry out these amendments to the leases? As all parties are in agreement, there will be no requirement for obtaining or paying a "marriage value", just changing a couple of clauses in the leases.

Do you really want to risk getting this wrong for the sake of paying 200 pound (each) to a solicitor to do it properly.

It isn't just a case of changing a few words in a document, you have to "register" the changes correctly.

mart.vader

@joepineapples

Here is a link for you : https://forums.moneysavingexpert.com/discussion/comment/58945133#Comment_58945133

smilalott

Hi,

could somebody offer some advice please,,
I'm going through the lease renewal process after just completing 2 years ownership of my one bed flat.

My flat has;
73 years remaining on the lease
£75 annual ground rent
Freeholder desktop valuation of £130k
Freeholder desktop valuation with new lease of £140k

I approached the freeholder and they came back with a few options of which the 90 year extension, £0 rent is my preferred one; they have asked for £10,070 plus costs. They have given me quite a detailed breakdown of the costs with 50% of marriage at £3,835.

Now every lease renewal calculator I've used comes back with around £8,000 so why are they so much more, the property valuations they have given are reasonably accurate maybe a £1-2,000 over valued?

Should I attempt to query this figure or would it be best to get my own valuation and get them to look at the figures?

Many thanks

Jonny_5

Really hoping I can get some good advice here as I am a bit of a panic. As others here my flat now has a lease of 66 years.
recently valued at £145,000 with current lease, or £160,000 with
an extended lease. The ground rent is currently £20 per year.

I wrote to my freeholder (informally) asking them to outline costs for extending the lease. At their request I also told them the current value of the property and that it was not due to me moving at this time.

I got a rather aggressively worded response detailing separate costs:

Premium: £15,800
For lease of 99 years from Dec 2012
ground rent: £250 per year, doubling every 20 years!
'in house administration' : £950
Reg fee increase of £75

They also outlined rather threateningly how if i were to envoke the 'statutory prodedure' their costs are likely to exceed £2000.

also they have specified a time limit of the offer of one month from letter date and that that the lease to be completed within one month of that acceptance.

to be honest i am shocked. The online calculators i have used estimated the renewal to be around the £12k mark.

I will be seeking professional advice but does this sound a reasonable offer ? It seems that they are positioning their cost to come close to what they say it might cost me if i go to a tribunal ?

Im now tempted to just sell up and offer money off the asking price, which will loose me equity but prehaps not as much as a lease renewal would cost me ?

Will i be able to get anywhere with negotiation with them ? and when would that negotiation become binding for me ? I don't really want the hassle of a tribunal and the associated wait (up to a year I understand?)

any advice would be most welcome.

tim123456789

On the numbers you have given that price is about double what it should be.

What they say about their costs is right, but they are just saying it to frighten you into the non-statutory route as it is better for them for you to pay 2K over the odds than to pay 2K to a solicitor.

But their offer is not 2K over the odds, it is a **** take.

Call their bluff, tell them that you think the offer is extortionate (it is) and if they can’t come up with a better non-statutory deal you will be forced to make a statutory application.

You would be advised not to try to sell without an extension. Even at a lower price you will find it hard to find a buyer as at 66 years the property is almost un-mortgagable and it will be cash buyers only

partialycloudy

We have just completed on the purchase of our lease.

We had 59 years and we were paying £50 ground rent which was due to increase this May to £250.

We purchased the lease for £19,254 (inc all fees, legal etc) it was only about £1000 more exspensive then extending it in the end.

We were advised that our flat was unsellable unless the lease was sorted out and hopefully we can now put it on the market for around £165k (we bought in 2007 for £155K)
I personally would never touch another lease hold property again, it has been a very expensive lesson to learn!

Jonny_5

tim123456789 wrote: »

On the numbers you have given that price is about double what it should be.

What they say about their costs is right, but they are just saying it to frighten you into the non-statutory route as it is better for them for you to pay 2K over the odds than to pay 2K to a solicitor.

But their offer is not 2K over the odds, it is a **** take.

Call their bluff, tell them that you think the offer is extortionate (it is) and if they can’t come up with a better non-statutory deal you will be forced to make a statutory application.

You would be advised not to try to sell without an extension. Even at a lower price you will find it hard to find a buyer as at 66 years the property is almost un-mortgagable and it will be cash buyers only

thank you tim. Since posting this I have talked to a solicitor who recommended a proper leasehold specific valuation on the property, he reckoned these disputes hardly ever go to the tribunals and that they are trying it on. Its just making the decision to go ahead and thus start paying for valuations and fees etc (all money i dont have). Once the process starts your 'in' as they say. Would it be worth me putting it on the market and seeing what offers I get ? then making a decision as to weather it is worth going for the extension?

my mortgage term is over in June and i would need to extend my mortgage to get the funds to pay for the lease extension. thus it would probably be somewhat a guess as to how much i will need at this stage. I would have to sit on the money until the dispute was settled.

just trying to clarify my options i suppose. I wish someone had advised me about all this 5 years ago or even before I bought it with 72 yrs left. All I was told is it may be hard to get a mortgage on it, never about how much it would all cost. never again!