Do I legally have to renew Leasehold

paulk73

I live in an upstairs terraced flat, the leasehold has less than 60 years remaining. 

The freeholder of the downstairs flat is selling his flat. 

He is trying to get me to pay to renew the leasehold, which I really can’t afford. 

Is there anything he can do legally to force me to renew this? He has asked me to get in touch with a solicitor to renew, presumably it will cost me to get a solicitor, which is something I can’t afford. 

Any help will be much appreciated. Thanks. 

Voyager2002

You can get free housing advice from Shelter.

Renewing the lease is very much in your interest.

Emmia

Not renewing before the lease expires means your property reverts to the freeholder who becomes the owner. 

As you've only got 60 years, you'll find it difficult to sell (if you wanted to) as the lease is now fairly short (buyers will struggle to get a mortgage) and the value of your property will also be substantially adversely affected.

Extending the lease also becomes increasingly expensive as the time ticks down.

eddddy

paulk73 said:

I live in an upstairs terraced flat, the leasehold has less than 60 years remaining. 

The freeholder of the downstairs flat is selling his flat. 

He is trying to get me to pay to renew the leasehold, which I really can’t afford. 

Is there anything he can do legally to force me to renew this? He has asked me to get in touch with a solicitor to renew, presumably it will cost me to get a solicitor, which is something I can’t afford. 

You are not legally required to extend / renew your lease.

But it generally makes good financial sense to do so. 

For example, if your lease costs £25k to extend, it might add £50k to the value of your flat.

You should definitely use a specialist leasehold extension solicitor for this.  And it would be sensible to pay a specialist leasehold extension valuer to tell you a realistic price for a lease extension - to make sure that you're not overpaying.

You should expect to pay between £1,500 and £2,000 in fees for your solicitor and valuer. It's also usual to pay the freeholder's solictor's and valuer's fees as well.

gwynlas

Is the freehold in the name of the lower flat or do you both own half?

Ideally you should have a share of freehold and grant yourselves new long leases together with clear indication as to on going maintenance issues.

A short lease causes issues at point of sale as unmortgageable

Emmia

gwynlas said:

Is the freehold in the name of the lower flat or do you both own half?

Ideally you should have a share of freehold and grant yourselves new long leases together with clear indication as to on going maintenance issues.

A short lease causes issues at point of sale as unmortgageable

I think the freeholder is the owner/seller of the downstairs flat - so the new owner will become the new freeholder, assuming both are being sold together.

eddddy

Emmia said:

I think the freeholder is the owner/seller of the downstairs flat - so the new owner will become the new freeholder, assuming both are being sold together.

@paulk73 It certainly sounds like the freeholder / downstairs owner is keen to 'sell' you a lease extension - probably before they sell the downstairs flat.

So, if you can get some funds together, it might be an opportunity for you to negotiate a cheap price, in return for a quick deal.

saajan_12

paulk73 said:

I live in an upstairs terraced flat, the leasehold has less than 60 years remaining. 

The freeholder of the downstairs flat is selling his flat. 

He is trying to get me to pay to renew the leasehold, which I really can’t afford. 

Is there anything he can do legally to force me to renew this? He has asked me to get in touch with a solicitor to renew, presumably it will cost me to get a solicitor, which is something I can’t afford. 

Any help will be much appreciated. Thanks. 

Well yes it'll cost not only for the solicitor but also to actually pay the freeholder for the extension. However this is likely to be in your interest, unless you don't want the flat beyond the next 60 years. This is because effectively you have a long rental for 60 years, after which it'll revert to the freeholder without further payment. The only way to avoid this is to extend the lease, and it'll only get more expensive as time goes on.