Buying freehold from leaseholders

Fraise

TrickyDicky101 wrote: »

Let's hope the OP returns and can enlighten us further.

When a landlord sells the freehold they cannot include future estimated profits, for the precise reason they can't know what future profits would be, and future profits would not be their concern. The freehold value is priced at the current worth. Your reasoning is likened to selling a work of art and charging what it might be worth in 100 years.



93 years IS a short lease. Ask a mortgage consultant. As soon as the lease gets to just 80 years long - and the OP is just 13 years away from that - to renew his lease at 80 years will be really expensive. Banks don't like lending money for properties with leases under 80 years long, and if the OP can't afford to extend his lease he may have trouble finding a buyer as they'll be unprepared to fork out for such a shirt lease, and the banks will likely refuse a mortgage.

The nearer it gets to 80 years the more expensive it becomes to extend.

They'd be better buying the freehold or a share of the freehold.

TrickyDicky101

The market value of anything is set by what a willing buyer and seller will exchange an asset for (that's an inherent part of the capitalist system).

That WILL include their assessment of potential cashflows arising from that asset (whether that be money paid out or money received in).

Fraise

TrickyDicky101 wrote: »

The market value of anything is set by what a willing buyer and seller will exchange an asset for (that's an inherent part of the capitalist system).

That WILL include their assessment of potential cashflows arising from that asset (whether that be money paid out or money received in).

Not when it comes to properties.

If that were the case people could sell their properties at what they assume they'll rise to in 100 years time lol.

TrickyDicky101

£100 now is worth more than £100 10 years from now. Same with any other future cash. Add in the risk (is the uncertainty) in whether that future cash will actually be paid/received and you will arrive at some figure that that future £100 is worth to you now. That will be its value to you. The value may be different to somebody else.

Anyway, I'm strongly reminded of Mark Twain's phrase. I'm out.

Freecall

Fraise wrote: »

Not when it comes to properties.

Why, what's special about properties?

A freehold sold the day before it grants a lease extension (and recieves the consideration for the grant) would have a very different value to one which has already granted a 999 year lease.

Fraise

Freecall wrote: »

Why, what's special about properties?

A freehold sold the day before it grants a lease extension (and recieves the consideration for the grant) would have a very different value to one which has already granted a 999 year lease.

I already explained how a 999 year lease is worth more than a short he. I think most people know that.

Properties are special, because they always increase in value in the longer,. Always.

AdrianC

Fraise wrote: »

93 years IS a short lease. Ask a mortgage consultant. As soon as the lease gets to just 80 years long - and the OP is just 13 years away from that

Yet only six years from the assignment of the original 99 year lease...

(I'm assuming that the lease wasn't originally 999 years, assigned in the year 1109?)

The fear over 80 years remaining on a lease really is absurd - I'm not saying it's not genuine, just that it's absurd. How many changes of owner will the average flat go through in 80 years? Will it even still be there, or will it have long since been redeveloped?