Buying leasehold property

[counterofbeans]

The mrs and I may be buying a little holiday chalet on the coast.

It's not expensive but it is leasehold, not freehold. It's 45 years through a 99 year lease so less than half way.

I appreciate that the value of a leasehold property may fall towards the end of the lease, but with 54 years to go would this property appreciate in the same way as a similar freehold property, or stand still or even fall?

Not bought leasehold before so would appreciate any guidance. We know all about the ground rent etc.

Thanks

p.s. originally posted this in HG&D but thought I might get a bit more guidance here...

[battered]

The usual deal upon renewal is that you can renew the lease to 99 years for an extra fee, usualyy modest. Most people do this. Ask your solicitor.

[counterofbeans]

battered said:

The usual deal upon renewal is that you can renew the lease to 99 years for an extra fee, usualyy modest. Most people do this. Ask your solicitor.

Sorry - by "upon renewal" do you mean on purchase of the property, or when the original lease expires?

[Sarnie]

counterofbeans said:

Sorry - by "upon renewal" do you mean on purchase of the property, or when the original lease expires?

When you purchase the property.......you need to think about when/if you come to sell it........it the buyer is mortgaging the property, a 45 year lease is going to be way too short for a lender...........

[counterofbeans]

Sarnie said:

counterofbeans said:

Sorry - by "upon renewal" do you mean on purchase of the property, or when the original lease expires?

When you purchase the property.......you need to think about when/if you come to sell it........it the buyer is mortgaging the property, a 45 year lease is going to be way too short for a lender...........

Well we'll be paying cash as the cost is well under £50k, these are only little holiday chalets so I can't imagine they will ever be mortgaged...

There are c.250 chalets on the development, is the freeholder going to do individual lease extensions every time one is bought and sold?

[randlemarcus]

counterofbeans said:

Well we'll be paying cash as the cost is well under £50k, these are only little holiday chalets so I can't imagine they will ever be mortgaged...

There are c.250 chalets on the development, is the freeholder going to do individual lease extensions every time one is bought and sold?

If they aren't then you need to be looking elsewhere.

[Sarnie]

counterofbeans said:

Sarnie said:

counterofbeans said:

Sorry - by "upon renewal" do you mean on purchase of the property, or when the original lease expires?

When you purchase the property.......you need to think about when/if you come to sell it........it the buyer is mortgaging the property, a 45 year lease is going to be way too short for a lender...........

Well we'll be paying cash as the cost is well under £50k, these are only little holiday chalets so I can't imagine they will ever be mortgaged...

There are c.250 chalets on the development, is the freeholder going to do individual lease extensions every time one is bought and sold?

We've done lots of mortgages on exactly these sorts of properties.......

[anonymous-user]

if it's a chalet - will it still be habitable at the end of the lease?

If it's a holiday park lease it will have all sorts of conditions so it's difficult to say.

[Cheib]

Don't know about these kind of preperties but certainly on London flats banks won't lend on a property with a 50 year lease. And if the Freehodler doesn't have a record of extending leases don't buy or treat your purchase as lump sum rental.