Lease extension premium. Negotiations

Bio23

AdrianC said:

I prefer muesli to cornflakes, anyway.

Seriously, OP...

There are two ways to resolve your short-lease issue.

One is the statutory route - and @anselld gave the link to the calculator for that. That will give you +90 years on the lease, and a peppercorn ground rent. Below 80 remaining years, the lease becomes unmortgageably short, so the flat value plummets - "marriage value" rapidly increases the renewal cost, because the value of the flat is being materially affected by the renewal.

The other is informal negotiation. The freeholder can ask for however much or little they wish, for as long or short an extension as they wish, and as much or as little ground rent as they wish, with whatever increase schedule they wish. You may or may not find their offer poor value. You may or may not be able to come to a mutually-agreeable solution.

If neither of those routes are palatable, then in 2091 your lease will expire. This is why lenders do not like short leases...

How long have you owned the flat? What did your solicitor tell you about the lease when you bought it?

Hi
Thanks for your reply. I bought the flat (50%) in 2010. Solicitor did not tell me anything about the lease . I was naive. I wanted to sell the flat recently and all the potential buyers were complaining about the lease. That is when I made an enquiry. Also I have just been informed by the freeholder that the premium is not negotiable because the valuation report is from my surveyor. What can I do in this situation? 

eddddy

Bio23 said:

I bought the flat (50%) in 2010. 

Are you saying that the flat is 'shared ownership'? And therefore your freeholder is a Housing Association?

If so, that's vitally important information. A lot of the previous answers in the thread won't be relevant in that case. With 'Shared Ownership' you have no statutory right to extend the lease.

Realistically, all you can do is follow the Housing Association's process for extending the lease. So if the Housing Association say the the cost of the extension isn't negotiable - you probably don't really have any choice. You accept it or walk away.

But Housing Associations are generally reasonable and fair about this kind of stuff. (I guess that if you could identify something they're doing that is clearly unfair, you might be able to persuade them to change it.)