Very short lease - costs to extend

eddddy

NameUnavailable said:

eddddy said:

Albermarle said:

What does this 'new lease on completion' really mean?

A better description would be "extended lease on completion".

In simple terms, it means you are buying 2 things (on the same day)...

• A flat with a 37 year lease - bought from the leaseholder (flat owner)

• A lease extension of maybe 90 years - bought from the freeholder

So the buyer ends up with a flat with a 127 year lease.

It could be done that way, with a cooperative freeholder, but of course the advice is to usually follow the formal process for a lease extension to avoid the freeholder slipping in higher ground rent charges etc.

@Albermarle was asking about a 'new lease on completion' or 'lease extension on completion' 

Realistically, it's not viable to do a statutory lease extension on completion. The only sensible way is how I describe above.

And it would now be illegal for the freeholder to increase the ground rent. And the buyer's solicitor would be able to clearly see any new terms that the freeholder was attempting to add to the lease.


But as you say, you need a cooperative freeholder - and you might end up having to pay 'over the odds' for the lease extension, in order to get the freeholder's cooperation.

If the freeholder won't cooperate - there's almost certainly no way you can achieve a 'lease extension on completion'.

Miri_J

JM68 said:

Don't bother viewing it would be my advice.

I did view, but as soon as the estate agent said, "we are having trouble getting hold of the owner", I knew I wasn't going to touch it. There was a lot of work needed on the flat anyway, not all of which was obvious from the photos. 

I've since had an offer accepted on a freehold house. It all seems much simpler that way.

Thanks for your help though.

TripleH

In this scenario it all depends on where the flat with a short lease is.

If we are in Central London, the price may reflect that the lease needs renewing. If Middlesbrough then the seller might be being optimistic.