lease extention - before owning for 2 years
Discussion
Hi,
i have a flat with about 83 years left on the lease.
I have owned it for 6 months.
So i cannot extend by right for another 18 monnhs.
But that is comfortably before the lease drops below 80 years and costs go up to extend.
I i approach the leaseholder now and ask if they would be willing to let me extend now, are they likely to agree?
It should make no difference to the cost whether doing it now or in 18 months time, but i could just get it out of the way, done and dusted.
Also, if the process to extend a lease was started with 80.5 years to go, but negotiations, etc took 12 months, and resulted in less than 80 years being left on the lease, would the extension cost be based on when negotiations started (more than 80 years) or or when the lease is extended (less than 80 years)?
Cheers.
i have a flat with about 83 years left on the lease.
I have owned it for 6 months.
So i cannot extend by right for another 18 monnhs.
But that is comfortably before the lease drops below 80 years and costs go up to extend.
I i approach the leaseholder now and ask if they would be willing to let me extend now, are they likely to agree?
It should make no difference to the cost whether doing it now or in 18 months time, but i could just get it out of the way, done and dusted.
Also, if the process to extend a lease was started with 80.5 years to go, but negotiations, etc took 12 months, and resulted in less than 80 years being left on the lease, would the extension cost be based on when negotiations started (more than 80 years) or or when the lease is extended (less than 80 years)?
Cheers.
Edited by philv on Sunday 14th August 13:56
Unless owned for 2 years, the landlord does not have to extend, and cost is whatever they agree to.
After 2 years, there is a legal right to extend.
If you go down this route, you can add 90 years to rne lease.
And no ground rent.
If he cost cannot be agreed tnen it goes to tribunal.
I could wait 18 months and have tne right to extend for 90 years with no ground rent.
But would rather do it now so it is out of rne way.
I was wondering if the landlord is likely to impose a premium for doing it before 2 years and want to keep a ground rent.
In which case i probably would be better waiti g?
Anyway, i have now written to tne landlord asking rnem about extending.
After 2 years, there is a legal right to extend.
If you go down this route, you can add 90 years to rne lease.
And no ground rent.
If he cost cannot be agreed tnen it goes to tribunal.
I could wait 18 months and have tne right to extend for 90 years with no ground rent.
But would rather do it now so it is out of rne way.
I was wondering if the landlord is likely to impose a premium for doing it before 2 years and want to keep a ground rent.
In which case i probably would be better waiti g?
Anyway, i have now written to tne landlord asking rnem about extending.
Well, mine has offered to extend -
from
83 to 125 years.
from
120 pa ground rent (increasing by 120 every 33 years)
to
200 pa ground rent (doubling every 25 years)
£5000 plus 1500 legal/valuation costs plus my costs approx 1000.
Not impressed.
In 16 month si can extend to 179 years for approx 6500 plus joint costs of approx 2500.
And no ground rent.
Save 1500 by doing it now, but have high ground rent and much shorter lease.
Pointless offer or am i missing something?
from
83 to 125 years.
from
120 pa ground rent (increasing by 120 every 33 years)
to
200 pa ground rent (doubling every 25 years)
£5000 plus 1500 legal/valuation costs plus my costs approx 1000.
Not impressed.
In 16 month si can extend to 179 years for approx 6500 plus joint costs of approx 2500.
And no ground rent.
Save 1500 by doing it now, but have high ground rent and much shorter lease.
Pointless offer or am i missing something?
I don't know were the property is or what its worth, but we extend lease on a flat circa value approx £280k, current lease was about 75 years, freehold was council, all in all total cost including both sets of legals was circa £18k.
As you mention less than 80 years and it gets messy and you have 'marriage value', were I think you end up having to pay the freehold 50% if what the property would go up by if lease extended.
I know its too late now but you should have been given the option to extend the lease when you were purchasing the property I believe you can legally extend on purchase or 2 years ownership, before that its freeholders choice.
As you mention less than 80 years and it gets messy and you have 'marriage value', were I think you end up having to pay the freehold 50% if what the property would go up by if lease extended.
I know its too late now but you should have been given the option to extend the lease when you were purchasing the property I believe you can legally extend on purchase or 2 years ownership, before that its freeholders choice.
You may wish to research " marriage value" & "Diminution" IIRC sub 80yrs of lease remaining the more the marriage value i.e. increase cost you to extend due to marriage value.... so leaving it may well cost a lot more. But as you are aware, sub 2 years you can't force the extension through but the landlord may not know the full facts himself.... certainly worth asking to extend.
Sorry to be vague but it's some time since I did an extension (as a landlord) but I am sure there are also set timescales, for offers, responding etc but if I was you I wouldn't want to get too close to the 80yr mark.
Make him a fair offer from the outset (there are free online calculators) and he may play ball....insult him with a derisory offer ( as one did to me) and he might play hardball instead (as I did).
eta should have read the post above before making my own.his seems to make more sense than mine
http://www.lease-advice.org.uk/calculator/
Sorry to be vague but it's some time since I did an extension (as a landlord) but I am sure there are also set timescales, for offers, responding etc but if I was you I wouldn't want to get too close to the 80yr mark.
Make him a fair offer from the outset (there are free online calculators) and he may play ball....insult him with a derisory offer ( as one did to me) and he might play hardball instead (as I did).
eta should have read the post above before making my own.his seems to make more sense than mine
http://www.lease-advice.org.uk/calculator/
Edited by alfie2244 on Wednesday 24th August 19:06
It sn't a problem waiting 16 months.
And will still have 81 years left.
To get it out of tne way/budgetary planning i would have paid a little more to do it now.
But not for 50+ less years on tne lease and significant increases in ground rent.
I'd be daft to do that and the offer from the landlord was pointless.
In 15 months it should cost a total of 10k max all n with fees both sides, and no ground rent.
Property value 210k north london.
So i will wait.
Thanks for tne replies.
And will still have 81 years left.
To get it out of tne way/budgetary planning i would have paid a little more to do it now.
But not for 50+ less years on tne lease and significant increases in ground rent.
I'd be daft to do that and the offer from the landlord was pointless.
In 15 months it should cost a total of 10k max all n with fees both sides, and no ground rent.
Property value 210k north london.
So i will wait.
Thanks for tne replies.
You need a surveyor who specialises in this area - they will value the extension for you and later negotiate with the other surveyor to reach a value agreeable to all parties.
I'm just doing one now having waited the two years and my side values it at £8750 and their surveyor £12,000 - I'm told to expect to do a deal at £9800
I tried to go early and they refused - if you are near Cambs/Herts/Essex I have a recommended surveyor
I'm just doing one now having waited the two years and my side values it at £8750 and their surveyor £12,000 - I'm told to expect to do a deal at £9800
I tried to go early and they refused - if you are near Cambs/Herts/Essex I have a recommended surveyor
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