Years left on a Lease

popptart

Hi all
I have googled this but can't find the info needed. When buying a flat, how long does the lease need to be. Have found a flat but the lease is only 73 years. From what I understand this is only a problem when it comes to selling. Is this correct?
Many thanks

Doozergirl

The lease needs renewing really as when you sell it will probably impact the value.

You either ask the vendor to do it before you buy OR you ask them to get a valuation from the freeholder, in which case you may drop your offer accordingly and get your solicitor to ask if the freeholder will extend the lease for you before you have lived there for two years. After two years you can legally force the freeholder to extend the lease by 90 years, but it probably better to get it out of the way as it can take 6 months or so (that's how long it took me!).

Not only do you have to pay for the lease extenion, but the legal fees for the freeholder as well as your own, so this adds a good £1000 to the bill.

PJD

Good advice from Doozergirl.

You say "this is only a problem when it comes to selling" - that's because no-one wants to be the one to renew the lease, as it will cost thousands, - quite how many thousands is anyone's guess, - probably somewhere between £3,000 and £33,000 TBH

Another reason people are wary of low leases is because mortgage lenders wont lend money on a property when a lease is below X amount of years, - typically this could be 60, 65, i've even heard of lenders not lending on a property with a lease of 70 odd years.

Richard_Webster

Because people do buy leases like this there is no incentive for sellers to sort out lease extensions themselves. If more people walked away and found a flat with a longer lease then maybe the prices would be more realistic to take into account the likely costs of lease extension. However in the present market sellers get away with it. If the market slumps they won't!

Regrettably sellers hope that the buyer won't really understand, or may be the seller has an over optimistic impression of the real worth of his flat - but as I have said - it is very often the case that someone buys it. It is not often that there are two completely identical flats on the market at the same time with widely differing lease terms so that it is possible to identify a genuine price difference because of that factor alone.

Ideally you should try to negotiate a purchase with the lease extension agreed with the freeholder and carried out "back-to-back" with the seller using part of your purchase money to pay for the extension which is then passed on to you. A walk through of how this could be done can be found at:

http://www.houseweb.co.uk/house/forum/Forum1/HTML/000429.html.

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients.

nollag2006

You really need to get an estimate of the cost to buy the lease before pursuing with the deal.

A friend of mine has had to pay £70k to get their lease on their Kensington flat extended from 70 years to 150.

These sort of figures could really colour your decision

cattie

Doozer as always has given great advice.

For further help & info on all issues concerning ownership leasehold property & extending leases, this is a valuable resource http://www.lease-advice.org
It's a not for profit govenment funded agency.