Advice wanted re: putting in an offer on flat with 75 yr lease

Rhubarb88

Hello money savers :-)

My first time on the forum and I'm hoping someone might have some advice for my current situation. I'm a first time buyer looking to get a 1 bed flat and have come across one in my area that's perfect in all ways - except it has a 75 year lease.

I've done a lot of reading online and on this forum where people have asked similar questions before - and understand that contrary to what the estate agent is telling me the fact this lease is under 80 years means that I will a) want to extend it and b) this will be costly - although I don't know how much!

Vendor has been 'looking into it' with her solicitor but no firm info that I've managed to glean so far. Because I don't want to wait two years to extend my offer will be conditional on her initiating the process and me 'inheriting' it on completion. Has anybody got experience of extending this way?

Flat is on the market at £149,950 and when I asked the estate agent if this valuation took into account the lease length they said that the lease wouldn't have an impact on their valuation until 40 years and below! This is obviously contrary to everything I've read elsewhere...

There are other interested parties and vendor has asked for best and final offers. I was intending on offering £144,000 to make allowance for lease extension costs as I am assuming there will be no real rise in value after the extension given flats with longer leases are priced similarly.

What's disappointing is that the estate agent has been fairly evasive on providing all this info and is trying to push me to up my offer saying other sellers are going to offer the asking. I expect the vendor will try their luck with a higher offer in the hope that the issue doesn't come up later down the line or that they'll be dealing with a buyer unaware of the potential extra costs etc with the lease...

I'm very new to all of this so any advice and thoughts on what my approach should be would be greatly appreciated!!!

dancingfairy

I believe it is generally best for the seller to extend the lease, as you say you will have to live there for some time before you can apply for a lease extension and the longer you leave it the more expensive it would be, not only that you would struggle to sell it on again if you bought the house and couldn't extend the lease yourself (obviously if you plan to live in it for a significant length of time it matters less re the resale, but still).
I'm not sure if it will cause you problems in terms of getting a mortgage? Presumably any problems it causes you it is likely to cause any buyer so it's really in the sellers interest to get it sorted, surely?
I'd be pushing for the seller to sort it.
df

strawberries1

OP, negotiate with the seller to extend the lease or at least start the process. Ie issue s.42 notice and get the landlord's total price and fees. The Act requires that you've owned the property for at least two years but at 73 years it'll be so much more expensive.
Reiterate to the seller that you are willing to proceed with the purchase but you need this done in order to avoid unnecessary costs.
I've posted some info from the Leasehold Advisory Service for you below.
http://www.lease-advice.org/publications/documents/document.asp?item=8#2