statutory leasehold extension - legal costs?

frago

privacy reasons

eddddy

Typically, the costs might be £2k to £5k, but it might be cheaper as your freeholder is a HA.

• Typically, you need a Lease Extension Valuer and Solicitor. They should give you fixed price quotes in advance.

• You also have to pay the freeholder's 'reasonable' costs - i.e. their Lease Extension Valuer and Solicitor. (They'll often be more expensive than your own ones - because the freeholder has no incentive to find cheaper ones.)

However, being a HA, they might use a reasonably priced valuer and solicitor - or they may even have an in-house solicitor / legal team.

It's worth asking the HA what Valuation, Legal (and Admin) costs they would charge you for a lease extension. If they do lots of them, they may have agreed fixed prices with their advisors.

eddddy

frago wrote: »

Is there any way to estimate the value of the flat post extension?

Probably the easiest way is to ask local estate agents.

You could say to the EAs that you're thinking of selling, and are wondering what impact a longer lease would have.


With 89 years remaining on the lease, I guess there are two types of potential buyer (assuming lease extension plus costs would be, say, £10k)...

• Type 1 - people who would prefer to buy without the lease extension, because the price would be £10k less (because they're at the top of their budget). And they can take a few years to save up that £10k to get the extension.

• Type 2 - people who can afford the extra £10k, and would prefer to buy it with the lease extension, to save the hassle of having to do it themselves.

Edit to add...

Or maybe try to look at it from a buyer's perspective...

Say, two very similar properties are listed:

• One is £395k with a 179 year lease
• The other is £385k with a 89 year lease

Which one would get more of your attention on Rightmove? Which one would you be more likely to offer on? Which one would you 'haggle' harder on the price? etc

Tom99

frago wrote: »

Thank you, I guess I will need to hire a lease extension valuer as well...
I would definitely go for the longer lease but that's just me. However, I hope that the value post extension will be higher by more than £10K so that I do recoup the extension costs...

At 89yrs you don't have to share the marriage value so whilst at an increase in value now of £10,000 might see you break even were you to leave it until your lease had 79yrs the cost could well be double to achieve the same extended lease value.
Your surveyor should be arguing for a low value for the extended lease because that is what the price you will pay is mostly based on.

eddddy

frago wrote: »

...including the solicitor I used for the flat purchase, they were v good.

...as long as they have experience in lease extensions.

Often it will be different people in the practice who deal with 'Landlord and Tenant' (lease extensions) and Conveyancing.

eddddy

frago wrote: »

Mid-October update:

2 October: my solicitor served section 42 notice, freeholder has until mid-Dec to serve the counter-notice
17 October: freeholder's surveyor will come in to inspect my flat

---
Total costs to date: £1455
My solicitor: £765 - solicitor fee, disbursements, AML search fee
My surveyor: £690 - lease extension valuation

Bear in mind that you'll also have to pay your Freeholder's solicitor and surveyor fee on top.

So in an ideal world that might be about another £1455.

But in reality, you may have shopped around and got a good deal - because the fees will be coming out of your pocket.


The freeholder may not have shopped around - because you will end up paying the fees, not the freeholder.

So the freeholder won't be bothered if the solicitor and valuer charge 'high-end' prices. And the solicitor and valuer will know this.