Should I buy? - A confused would-be purchaser

andrew5555

Advice please!

We are currently in the process of buying a two bedroom flat in Kent. It's fairly tired looking, but is large and offers us the opportunity to put some time and effort into making it beautiful. This is being bought as a second property for long-term investment purposes (10 years?), as we don't want to give up our cheap rented flat in London. Our intention is to divide our time between the two properties.

The issue. The flat only has a 75 year lease, and an intermediate landlord. We found this out when we asked our lawyer to check out how much it would cost us to extend our lease. Alarm bells are now starting to ring for me, as the fear is that it's not going to be straightforward for us to up the lease.

Should we buy this flat, or run a mile?

(I've also noticed that the two other flats in the house have both been let out to tenants (does this signify owners getting out quick?) - this may be utterly meaningless, but excuse my ignorance. ((And the property next door is a care home, if that means anything.))

Some other information. When we had the flat valued we were told that it was in good condition, but was at the upper limits of the price bracket for properties of its type. (which are few and far between).

It's obviously in everyone's interest that we complete the sale (lawyers, mortgage broker, estate agent) so we need impartial advice at this stage.

Doozergirl

I can't see what the issues might be. It's next door to a care home? The other flats are tenanted? If the owners were getting out quick, they'd have sold, surely?

As for the lease extension, you're waiting for a quote so you can make decisions when you find out how much it might be. If you are paying top whack then I would suggest that you obtain a reduction similar to the cost of a lease extension - whilst it isn't too much of an issue now, you will need to extend the lease at some point during your ownership. Quite soon really.

When you talk about intermediary landlords, are you talking about a managing agent?

andrew5555

:oI wasn't sure what was relevent - I read somewhere that leases can operate differently if one part of a building is used for commercial purposes, so thought I would add that fairly pointless piece of information.

To clarify, one of the two flats above has recently been sold, and bought by someone who is letting it out. The other one has been let out to tenants - I don't know how long this has been owned by someone. When this issue came up I got a bit suspicious.

The intermediate landlord isn't the managing agent, we have one of those as well. Apparently the intermediate landlord has a lease agreement with the main landlord, and as far as I can gather, if their agreement is shorter than the 75 years of the lease, then we can't get an extension beyond their agreement.

My worry is that we are not ever going to be able to extend the lease due to this peculiar arrangement - and so, the value of our flat will go down every year.

Doozergirl

Ok, I know nothing about headleases so I have to admit defeat. Sorry I can't help.

www.lease-advice.org has a telephone number where you can check whether you will be able to extend the lease. The law these days is very helpful toward the leaseholder so I'd be surprised if you absolutely couldn't.