Extend Your Lease guide discussion

Tom99

I would go with a fixed fee, hourly could soon run up quite a bill.

strawberries1

Tom99 wrote: »

I would go with a fixed fee, hourly could soon run up quite a bill.

The hourly one I'm considering is capped at £800 +vat.
The 10% of reduction achieved will be max £600 (+vat) (this is the disparity btw notice and counter notice premium) + £250 (+vat).

OnceUponATime

Hi all, I am really new to this but as you all seem so knowledgeable, I figured that I'd ask your opinions on this matter as I am a first time buyer.

The flat is a shared ownership, housing association (HA) part owned flat (they are the freeholder). It is 1 of 4 in a converted terrace. It was on the market a few weeks back at 430,000 and has now been reduced to 400,000, to reflect the lease term. I would be purchasing 30% at 120,000.
I have had a look on the land registry and see that the basement and top floor flats have had their leases extended to 100+ years. I can also see from the site that the flat that I wish to purchase as well as the 1st floor flat have 'option to purchase a percentage of the freehold' listed as a note. Which leads me to believe that the other two flats have already done this as this is not an option listed for them on the land registry site. So having said all this, I have several questions should I put in an offer.

1. If it is the case that the other two neighbours have purchased a percentage of the freehold and I wish to extend my leasehold, will I have to go through them as well as the HA?

2. Do you think that as they have deducted 30,000, it means that they might try and charge me this amount to extend the lease because that's what they believe it will cost?

3. Do you all think that the amount deducted is a fair amount considering that I am only purchasing 30% for now?

4. As I will only own 30%, will I be expected to pay 30% of the lease extension as the HA own the other 70%?

5. Has anyone had anyone else had any dealings with extending leases when the freeholder is a HA and what was your experience?

Any advice would be much appreciated, thanks in advance!

Tom99

OnceUponATime wrote: »

Hi all, I am really new to this but as you all seem so knowledgeable, I figured that I'd ask your opinions on this matter as I am a first time buyer.

The flat is a shared ownership, housing association (HA) part owned flat (they are the freeholder). It is 1 of 4 in a converted terrace. It was on the market a few weeks back at 430,000 and has now been reduced to 400,000, to reflect the lease term. I would be purchasing 30% at 120,000.
I have had a look on the land registry and see that the basement and top floor flats have had their leases extended to 100+ years. I can also see from the site that the flat that I wish to purchase as well as the 1st floor flat have 'option to purchase a percentage of the freehold' listed as a note. Which leads me to believe that the other two flats have already done this as this is not an option listed for them on the land registry site. So having said all this, I have several questions should I put in an offer.

1. If it is the case that the other two neighbours have purchased a percentage of the freehold and I wish to extend my leasehold, will I have to go through them as well as the HA?

2. Do you think that as they have deducted 30,000, it means that they might try and charge me this amount to extend the lease because that's what they believe it will cost?

3. Do you all think that the amount deducted is a fair amount considering that I am only purchasing 30% for now?

4. As I will only own 30%, will I be expected to pay 30% of the lease extension as the HA own the other 70%?

5. Has anyone had anyone else had any dealings with extending leases when the freeholder is a HA and what was your experience?

Any advice would be much appreciated, thanks in advance!

[FONT=Verdana, sans-serif]Without seeing the exact wording of the option and terms of the existing lease it is difficult to comment.[/FONT]
[FONT=Verdana, sans-serif]What is the unexpired term of the existing lease and how much is the ground rent and are there any reviews to the ground rent?[/FONT]
[FONT=Verdana, sans-serif]I expect the asking price was dropped because it was overpriced and not selling.[/FONT]
[FONT=Verdana, sans-serif]I am not sure, but I don't think a shared ownership lease has any statutory right to a lease extension so you will be relying on the Option and/or the goodwill of the HA.[/FONT]

eddddy

OnceUponATime wrote: »

Hi all, I am really new to this but as you all seem so knowledgeable, I figured that I'd ask your opinions on this matter as I am a first time buyer.

The flat is a shared ownership, housing association (HA) part owned flat (they are the freeholder). It is 1 of 4 in a converted terrace. It was on the market a few weeks back at 430,000 and has now been reduced to 400,000, to reflect the lease term. I would be purchasing 30% at 120,000.
I have had a look on the land registry and see that the basement and top floor flats have had their leases extended to 100+ years. I can also see from the site that the flat that I wish to purchase as well as the 1st floor flat have 'option to purchase a percentage of the freehold' listed as a note. Which leads me to believe that the other two flats have already done this as this is not an option listed for them on the land registry site. So having said all this, I have several questions should I put in an offer.

1. If it is the case that the other two neighbours have purchased a percentage of the freehold and I wish to extend my leasehold, will I have to go through them as well as the HA?

2. Do you think that as they have deducted 30,000, it means that they might try and charge me this amount to extend the lease because that's what they believe it will cost?

3. Do you all think that the amount deducted is a fair amount considering that I am only purchasing 30% for now?

4. As I will only own 30%, will I be expected to pay 30% of the lease extension as the HA own the other 70%?

5. Has anyone had anyone else had any dealings with extending leases when the freeholder is a HA and what was your experience?

Any advice would be much appreciated, thanks in advance!

With a shared ownership property, you have no statutory right to extend the lease.

See: https://www.lease-advice.org/faq/i-have-a-shared-ownership-lease-do-i-have-a-right-to-extend-my-lease/

Therefore, you can ask for a lease extension, but if the freeholders say "no" or ask for a silly price - there is nothing that you can do.

The only way of get a statutory right to extend the lease would be to buy 100% of the lease first.


In your position, I would really want a 'lease extension on completion'. i.e. You buy the current lease from the owner, plus a lease extension from the HA at the same time.

(And the deal would be that you only buy the current lease on the condition that you buy the lease extension at the same time.)

OnceUponATime

So I'm now wondering if it may be a good idea to buy a percentage of the freehold instead?

OnceUponATime

I'm going for another viewing so will ask the current owner lots more questions.

eddddy

OnceUponATime wrote: »

1. If it is the case that the other two neighbours have purchased a percentage of the freehold and I wish to extend my leasehold, will I have to go through them as well as the HA?

OnceUponATime wrote: »

So I'm now wondering if it may be a good idea to buy a percentage of the freehold instead?

Based on your questions, either the HA has set up a very strange scheme, or perhaps you've misunderstood about buying freeholds.


A typical example would be that 3 leaseholders club together and buy the freehold of their building. (So they each own 33%.)

In your case, I wonder if the other 2 leaseholders clubbed together and bought the freehold. (So they own 50% each.)

But whoever owns the freehold might not want to sell any of it to you.


And even if whoever owns the freehold sells you a 'share' - that probably won't really help you get a lease extension.

E.g. If you're 1 of 3 people who own the freehold, the others can just vote 2 to 1 against letting you 'buy' a lease extension.

Tom99

OnceUponATime wrote: »

So I'm now wondering if it may be a good idea to buy a percentage of the freehold instead?

[FONT=Verdana, sans-serif]You say there is a Land Reg note that two of the leases have an 'option to purchase a percentage of the freehold'[/FONT]
[FONT=Verdana, sans-serif]That would be an odd think for any freeholder to include in a lease, even more so a HA. How would it work with you owning a 30% share? Would you be buying 25% x 30% = 7.5% of the freehold.[/FONT]
[FONT=Verdana, sans-serif]I doubt very much this option, if it exist at all, is what you think it is.[/FONT]
[FONT=Verdana, sans-serif]By all means ask the current owner questions about the lease but don't assume whatever they tell you is correct without checking the actual lease as soon as possible.[/FONT]

ruby2sday

Hi! I’m a first time buyer and have found a dream flat up for auction with a super low guide price of 90k, but it only has 17 years on the lease. Is the cost of extending going to be insanely high?