Any lease hold experts in the house ?

Page may contain affiliate links. Please see terms for details.

Cuchilo

Prize winning member X2
Location
London
Ive seen a property at a very attractive price but it only has 40 years left on the lease . I'm told at the moment it will cost about 50k to extend the lease and that still makes it an attractive price .
Tell me the worst that can happen :unsure:
 

winjim

Smash the cistern
After two years the freeholder is obliged to sell you the lease at market rate. I've known them go for as little as a few hundred quid if the freeholder's not that bothered. Our solicitor advised that ours might be a few grand as our landlord keeps a rather tight hold on the purse strings. 50k seems an awful lot.
 

Brains

Legendary Member
Location
Greenwich
I'd be inclined to negotiate the lease extension first, see if it's 'really' £50k.
It could be a lot more or a lot less.
You will also have a Surveyors bill and a Solicitors bill that add up to the wrong side of a grand (or two) on top.

It also depends on your age, and the age of the lease holders.
If you are a couple of decades younger than they are, then it's probably worth a punt.
If however they are a couple of decades younger than you, I'd be a lot less interested.

Also if this is a flat, look very closely at the Management fees.
We decided a number of years ago that we would only buy properties without management fees (and therefore usually freehold, but there are exceptions)

Remember property is a long term investment, where time is measured in decades not quarters.
 
OP
OP
Cuchilo

Cuchilo

Prize winning member X2
Location
London
No mortgage and from what i have seen so far (1 day ) an overseas investor has dropped the price by 60k within a year ....... hmmmmm
 

Hacienda71

Mancunian in self imposed exile in leafy Cheshire
Iirc The Leasehold Enfranchisement Act is the legislation that applies (The LEA only applies to residential property not commercial) You can either extend the lease for I think 99 years or buy the freehold collectively in the case of flats. You need a specialist surveyor and solicitor acting for you. The notice serving procedure is very prescriptive and has to be done correctly and the valuation methodology is not a straightforward comparable calculation your average estate agent can do. The hurdle you will need to overcome is funding the purchase with a relatively short unexpired residue on the lease. In valuation terms plus 60 years is considered perpituity but sub 70 to 80 years unexpired gets lenders nervous. My knowledge on this is a bit archaic so double check with an appropriate professional with current experience.
 

Levo-Lon

Guru
If its been up for sale for over a year and price has dropped 60k in a year?
What are you not being told or seeing?

It may simply be the "no mortgage aspect" or a survey is throwing up a problem.
That said it maybe a greedy seller or estate agent.
Greedy seller will dig their heels in when you want to buy leasehold
 

Freds Dad

Veteran
Location
Gawsworth.
If the property is structurally sound can you agree a price including the freehold?
I know when we look to buy houses to either refurbish or rent out we won't touch anything that us leasehold.
 
OP
OP
Cuchilo

Cuchilo

Prize winning member X2
Location
London
Sorry , forgot to mention its a flat in a block of flats so buying the freehold is not an option ? The lease holder / owner is a foreign investor and the estate agent was very open about the property and said the catch was the 40 year lease . The agent had handed back the keys as they didnt really want anything to do with it because of the lease issue . I guess because no lender would give a mortgage on it .
 
Speak to the other residents as they might be in the process of buying the freehold or renewing the lease.

If they are then don’t consider anything until the lease has been renewed

If they are not walk away as you can’t buy the freehold without them.
 
Top Bottom