Challenging sale - no more advice required

watermelonspring

Please see below for quotes of original post. Thanks for all advice. No more is required as the sale has ended. 

ProDave

Read all the horror stories about shared ownership then have a long hard think, do you want to proceed?

watermelonspring

ProDave said:

Read all the horror stories about shared ownership then have a long hard think, do you want to proceed?

Hi there, it’s not shared ownership. It’s a normal fully-mortgaged property. 

Falafels

Quite apart from the shared ownership issue, it's a good idea to have a long lease for the purposes of resale - not because you want to live in it for 99 years!

watermelonspring

Falafels said:

Quite apart from the shared ownership issue, it's a good idea to have a long lease for the purposes of resale - not because you want to live in it for 99 years!

Hi it’s not a shared ownership property. It’s a share of freehold property. I’d never buy shared ownership, unless these are the same thing?

steampowered

I find this story difficult to follow.

Are you also trying to buy the leasehold to one of the properties? If so, wouldn't it be in your interest to get the lease extended as this will significantly affect the value of the property? The property will drop in value over the next 5 years as the lease clock ticks down.

I'd have thought its also in your interest to get archaic terms / ground rent removed, even if you have to pay your solicitor/conveyancer for the work that will involve.

Why are you buying a short lease? Presumably you are buying in cash with no mortgage?

anselld

Why do you not want an extension and peppercorn rent?  Are they demanding an additional fee for this?
It is normal for share-of-freeholders to issue themselves long leases at zero ground rent without cost other than legal fees so why would you decline?

Ultimately, if you cannot see eye-to-eye with the other joint freeholder then you are asking for trouble in proceeding with the purchase anyway so the fact that you cannot proceed may be a blessing.

Doozergirl

Why would you not want the lease extension?

If you're selling with 80 years then the next buyer is likely to demand it.  What's the point in stalemate now when you can just deal with the issue once and have the benefit of no ground rent and (probably) 999 years on the lease? 

You're going to be paying for it in some form before you sell the property.  

watermelonspring

steampowered said:

I find this story difficult to follow.

Are you also trying to buy the leasehold to one of the properties? If so, wouldn't it be in your interest to get the lease extended as this will significantly affect the value of the property? The property will drop in value over the next 5 years as the lease clock ticks down.

I'd have thought its also in your interest to get archaic terms / ground rent removed, even if you have to pay your solicitor/conveyancer for the work that will involve.

Why are you buying a short lease? Presumably you are buying in cash with no mortgage?

Sorry perhaps I haven’t explained it well. It’s a house that has been converted into two flats. So the people who buy the flats share the freehold and manage it as a company. Does that make sense?

I have been told that a lease below 70 years is a problem. We’re quite keen to move in ASAP and extend the lease after we’ve lived there for two years if we need to. My lawyer says it’s not necessary for the sale. We have a mortgage approved. 

watermelonspring

Doozergirl said:

Why would you not want the lease extension?

If you're selling with 80 years then the next buyer is likely to demand it.  What's the point in stalemate now when you can just deal with the issue once and have the benefit of no ground rent and (probably) 999 years on the lease? 

You're going to be paying for it in some form before you sell the property.  

The lease extension is going to significantly delay this process. We were just about to exchange and now we can’t. We’re under some time pressure. I feel that a sudden last minute demand of a lease extension and a threat to halt the sale is quite intimidating. Perhaps it’s my inexperience. I’m more than happy to arrange a lease extension and pay all the expenses. 

watermelonspring

anselld said:

Why do you not want an extension and peppercorn rent?  Are they demanding an additional fee for this?
It is normal for share-of-freeholders to issue themselves long leases at zero ground rent without cost other than legal fees so why would you decline?

Ultimately, if you cannot see eye-to-eye with the other joint freeholder then you are asking for trouble in proceeding with the purchase anyway so the fact that you cannot proceed may be a blessing.

I am happy for a lease extension but it’s not clear on why this cannot wait. It’s going to delay the sale by several more weeks which we have not planned for. It is also the manner in which it was demanded with a threat to halt the sale if we don’t agree.