Misinformed Leasehold Query

ashackleton

Hi all,

My partner and I are in the process of buying a property and have just received the paperwork from the vendors solicitors. In it it states that there are 89 years left on the leasehold. When we were shown around the property we were told that there were 94, and that is what we based our offer on. We realise that 5 years is unlikely to affect its value at this point, but our issue is say we want to sell 5 years down the line or so, we are in a considerably worse position.

Does anyone have any experience in what we can do here? Our solicitor is going to query the vendors about this; is there more that we can do?

Thanks!

Thrugelmir

Renegotiate the price.

need_an_answer

Quite a short lease either way.

TBH the lease details are never really confirmed until the documentation is obtained by the solicitor.

How much have you spent so far on the purchase v how much will a lease extension cost you,ask your solicitor about the process for lease extending and decide if its something you wish to make use of in the next 5 years or so.

You could ask for a reduction in price although the vendor is not the one who is obliged to offer a price reduction.

As leases diminish they do indeed start to lose their appeal for some and you just need to decide whether this 5 years has a huge impact for you or not.
Extending the lease can sometimes be a protracted and complicated affair,sometimes its straightforward but its best to know now the likely costs so you can make an informed decision going forward.

Once the lease is extended it should put you in a much better position when you come to sell,but given that you may want to sell in only a few years time it may or may not end up being cost effective.

I assume your mortgage company is ok with the lending?

ashackleton

Yes, mortgage company is still fine with it and haven't flagged it up at any point.

We've asked our solicitor to look into how we'd go about extending the lease and how much it would cost. Is negotiating the price to reflect this a sensible option? First time buyers so little experience with this.

need_an_answer

What does your solicitor say about renegotiating the price?
I would look to them for clarity.

There may be little harm in asking for a price reduction but it all depends how far through the process you are at the moment.The vendor may easily agree they may not and then its up to you to decide if the property is still the one for you.

I believe the magic figure where people are very jittery about leases is around the 80 year mark so in honesty you were pretty close to that in the first place.
On the other hand some people take minor notice of lease length and in some cases are even prepared to give back the property at the end of the term as it has served its purpose

You said in your opening post that you based your offer on there being 5 more years of the lease than you now have established,the question is how much more did you offer with this in mind?
Did you match asking price?
Did you offer below asking price and if you had known the true lease length what would your offer have been?
You can only renegotiate if you actually know what you have offered for these "extra" 5 years that are no longer there.

Its a personal decision you need to make once you find out the costs of extension.
I don't believe anyone can make that decision but you

For the record I have 4 leasehold properties and will always look for something with a lot more years remaining,Ideally as close to the 900 mark as I can.on at least 2 properties I've walked away at 125 years so anything in double figures is an automatic no,but each purchaser is different and has different priorities.

Tom99

[FONT=Verdana, sans-serif]Use one of the online calculators to work out the cost of extending a 94 yr lease v a 89 yr lease and ask for a reduction in price on that basis.[/FONT]
[FONT=Verdana, sans-serif]If you want to extend the lease now then ask the vendor to serve a section 42 notice and assign it to you to complete.[/FONT]