Extending the lease

wheelz

I'm aware that I probably should be extending the lease of my flat while I've got no immediate plans to sell. I no longer live in the flat myself. Eventually me and my partner will want to buy a house (we are renting at the moment) and use the money of my flat. I've also heard of people selling their flat and the new owner and the seller shared the cost of the extension of the lease. Is that rare and should I really be thinking of extending the lease? I think my lease is around 65 years.

I've read in another thread that:

"If you ask the freeholder "How much would you sell me a Lease Extension for?", they can pick whatever price they choose - it could be £5,000 or £50,000 or a straight refusal to sell.

But once you've owned the leasehold for 2 years, you have the statutory right to buy a lease extension at a price calculated by a statutory formula. (But many freeholders won't co-operate with this route, because they cannot charge "whatever they want".)

Taking the statutory route means you have to serve notices on the freeholder etc."

I remember from a long time ago when other flat owners in the block wanted to extend the lease the freeholder made life very difficult for them. I guess things won't have changed so I'm dreading this whole process.

Is the correct process asking the freeholder how much and then go through the formula as above. How do I know what's reasonable? Do I need a solicitor for all this? What is the number of years I should be extending to? 99 years?

eddddy

Here's a useful guide on ths topic: http://www.lease-advice.org/publications/documents/document.asp?item=8

wheelz

Thanks for that. Don't understand it all but it has clarified things. What I would like to know is below how many years of lease remaining is it essential to extend the lease. I have no idea how much I am looking it, what will it cost?

Lord_Baltimore

wheelz wrote: »

Thanks for that. Don't understand it all but it has clarified things. What I would like to know is below how many years of lease remaining is it essential to extend the lease. I have no idea how much I am looking it, what will it cost?

You are already late to the party and shouldn't have let your lease go below 80 years. See here.

Anyway, don't hang about or it will get even more expensive.

eddddy

wheelz wrote: »

Thanks for that. Don't understand it all but it has clarified things. What I would like to know is below how many years of lease remaining is it essential to extend the lease. I have no idea how much I am looking it, what will it cost?

There are a number of lease extension cost calculators on the web, here's one: http://www.lease-advice.org/calculator/

I guess it's not essential to extend your lease, but the flat will start to go down in value if you don't - and the cost of the lease extension will increase.

And selling it with a short lease may be a problem. Many of the big mortgage lenders require at least 70 years unexpired on a lease.

££sc££

wheelz wrote: »

What is the number of years I should be extending to? 99 years?

usually 99 years is added onto unexpired term, not extended to 99 years

eddddy

££sc££ wrote: »

usually 99 years is added onto unexpired term, not extended to 99 years

For a Statutory Lease Extension is would be 90 years plus the unexpired term - at a peppercorn (i.e. zero) ground rent.

If it's an Informal Lease Extension it can be for whatever period and whatever ground rent the freeholder and leaseholder agree on.