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Comments
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Hi,
I have just read your feedback to several of the comments on this thread and would like to connect with you for some advice on my lease extension process and how to start it.
I have a flat valued at around £460k with only 62 years remaining on the lease. I have approached the leaseholder who has responded with a valuation of £70,000 for an extension of 90 years!!! This is the most expensive lease extension I have ever heard of and would like to know how to go about the negotiation process.
I am happy to pay for good advice. Please can you help?0 -
Hi,
I have just read your feedback to several of the comments on this thread and would like to connect with you for some advice on my lease extension process and how to start it.
I have a flat valued at around £460k with only 62 years remaining on the lease. I have approached the leaseholder who has responded with a valuation of £70,000 for an extension of 90 years!!! This is the most expensive lease extension I have ever heard of and would like to know how to go about the negotiation process.
I am happy to pay for good advice. Please can you help?
A person to pay for good advice would be a lease extension valuer - perhaps a person/firm that is accredited by the RICS.
It sounds like your freeholder has offered you an informal ease extension for £70k, so you can make a counter offer, if you want. (Be very careful about ground rent terms. Bad ground rent terms could make your flat unmortgageable.)
Or you can take the formal route, and serve notice on the freeholder.
Use an online calculator to get an idea of what a statutory lease extension would cost: For example: https://www.lease-advice.org/calculator/
There's also some good info here: https://www.lease-advice.org/advice-guide/lease-extension-getting-started/0 -
Rustyfox, in view of the value of your flat and the number of unexpired years on your lease you will probably find that, that valuation is not far off what you will have to pay if you agree to a peppercorn rent. However, it may be a little less depending upon what ground rent you agree too. As per edddys advice watch out for exorbitant rents being included and/or an unreasonable escalation clause. Having said that, it is your solicitor's job to inform you of anything onerous in the legal paper.
Last time I looked there were two ways to extend a lease. One is by a private agreement with the landlord, which is what you appear to be engaging in now. The second and the best method imo is to go down the statutory route and serve notice on the landlord. I say the best because this way you have the protection of the statute. What do I mean by that? There is a set procedure in which the landlord must act in timely manner and if there is any dispute it may be referred to a valuation tribunal. I understand that negotiating outside of the statute there is no recourse to these things if the landlord does not want to act in a fair manner. If that were the case you would have to use the statute anyway. In fact, I think the reason why the act was introduced was to protect leaseholders from unscrupulous landlords.
The only way to ensure that you are paying a fair price is to employ a professional valuer i.e. someone who is a member of the Royal Institute of Chartered Surveyors (RICS). You will have to do this anyway if you take the formal route. I understand the landlord nominates the surveyor and you will be responsible for both the surveyors and landlords solicitors fees. You will also need your own solicitor for the legal work.
The lease advice site that eddddy pointed out is an excellent resource. Last time I looked they provided lists of solicitors experienced in this work and I think also RICS valuers. If not, just go to RICS website. Furthermore, you should get all your questions answered there. They also have a free legal helpline but expect to have to sit in a long queue before your call is answered.0 -
Looking for some views/advice please -
I have 83 years unexpired on my leasehold flat which is valued at £159,000
Myself and solicitor are currently informally negotiating with the landlord - who has offered £6,800 as a premium for a 125 year lease, with ground rent rising by £200 every 10 years.
Solicitor says that the 10years/£200 is extortionate and we could propose the following:
0-25 years: £200
25-50 years: £400
50-75 years: £600
75-100 years: £800
100-125 years: £1000
For best interests, the lease would need to be renewed when it hits marriage value of 80 years, so between 25-50 years time, so the maximum ground rent that should be payable is £400.
My concerns:
1) The premium (£6,800) is too high, but I have no basis to judge (the calculator confuses me as I am unsure what the value of my property would be with the extension in place).
2) Whether I should serve notice and get peppercorn ground rent (However, I do understand that serving notice would involve further expense/time and more potential headaches).
So, for those reasons I would prefer to informally resolve if my above counter offer is (for my best interests) reasonable enough. My problem is, I have no idea if I should be asking for more/just serve notice. Thanks0 -
At least your solicitor is on your side. He/she is right. Also the formal route is recommended to get your groundrent reset to zero. And actually the government should announce changes in the summer that might make the lives of leaseholders easier. Best info:
https://www.leaseholdknowledge.com
https://www.moneysavingexpert.com/mortgages/extend-your-lease0 -
Hi,
I have just read your feedback to several of the comments on this thread and would like to connect with you for some advice on my lease extension process and how to start it.
I have a flat valued at around £460k with only 62 years remaining on the lease. I have approached the leaseholder who has responded with a valuation of £70,000 for an extension of 90 years!!! This is the most expensive lease extension I have ever heard of and would like to know how to go about the negotiation process.
I am happy to pay for good advice. Please can you help?
Because the lease term is below 80 years that could very well be the correct amount. The way the rotten law works to calculate what you pay is stacked in favour of the freeholder and comes out at insane amounts of money that many people cannot afford.0 -
Hi,
Sorry if I'm completely missing something but can someone please point me in the right direction?
When you own share of freehold, along with one other flat and want to extend your lease, what costs are incurred?
I know there will be legal fees, but are the rest of the costs relevant, because I have "heard" that you just have to pay the legal charges (which of course could be split between the two flats in the agreement) but never seen that advised anywhere online/anything I've read.
Does anyone have any experiences as to how much the legal fees might come to?
Thank you in advance.0 -
If you have a share of the the freehold, there surely is no need to extend the lease.0
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If you have a share of the the freehold, there surely is no need to extend the lease.
@miller3653 thanks for replying.
So when you have share of freehold, you own the property in two capacities... for example the flat we're looking at is the ground floor in a converted terrace house. We would be owning the freehold for the building with the upstairs.
So building insurance, roof /common area repairs etc all falls to us 50/50.
We are also leaseholders of the downstairs flat. Because we don't hold that completely freehold and our freeholders are essentially us and the upstairs neighbours.
Sorry it's really complicated to try to explain.
It means that you do end up with a lease though usually because you have a lot more control in that situation, people would just increase it to 999 years which makes it easier/not have to worry about getting into short leases.
Concern is that this property is on 87 years and I can't find out anywhere what the costs are (if any) for renewing a lease beyond legal fees (which I'm not sure how much they'd be but hopefully they'd be halved anyway as upstairs also have 87 years on their lease so makes sense if we do it at the same time) for a share of freehold property ...0 -
Sorry it's really complicated to try to explain.
It means that you do end up with a lease though usually because you have a lot more control in that situation, people would just increase it to 999 years which makes it easier/not have to worry about getting into short leases.
<snip>
Because you and your neighbour jointly own the freehold, you can agree between you to extend the leases to 999 years, if you want. (But equally, one of you can object - perhaps to get money out of the other party.)
Assuming you both agree, you need to get a solicitor to draw up a Deed of Variation for each lease. You will probably also need a Deed of Substituted Security for your mortgage lender.
You can ask a few solicitors for quotes for dealing with one flat, and for dealing with both - to see if they will give you a discount, for doing both together.0
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