Lease extension for B-i-L's apartment -new legislation?
Discussion
My sister and brother in law are trying to sell both their properties to joint buy a larger place for themselves.
Sounds good in theory? But the whole thing has fallen through and they've both given up on the idea for now.
BILs studio flat has only 58 yrs on lease, they've been speaking to 'a solicitor' recommmended by estate agent. who I think has spoken with leaseholder and come backe with a price to extend of £44k. This is on a small studio flat worth a little more than £100k and £60 pa ground rent!
Sadly my sister and her partner are not well off and not very wise to worldly things so I've offered to help try and sort this out with a view to get them moved in together.
Further background, my sister wants to sell her flat with issues: shared ownership which is not so straightforward to extricate from (and her equity now turns out a lot less than she was expecting), and terrible neighbour problems (local housing association houses people with mental health issues upstairs who regularly call the police on her!
So. You can imagine things are not simple, and my sister and partner don't have too much ready cash to throw at problems. This often means they sit on things making them worse over time. E.g I believe BiL bought his flat in cash from an inheritence, no mortgage, around 15 yrs ago, which would have meant his lease was at 72 yrs already. But he can't recall being advised this was an issue or to look to extend it at any point or negotiate a lower purchase price. Like I said, not very worldly and prone to receiving poor advice.
There are already some very useful threads on PH and elsewhere thagt talk about ways to extend leases that should not cost anything like that amount, but the process still will be lengthy and costly.
I'm going to sit down with them get all this on the table, and look at creating a plan, a budget and help work out what they need to do even if its going to take a while to resolve.
With regard to lease extension I'm going to suggest engaging a good surveyor specialised in extensions and negotiations. I see there is new legislation that helps leaseholders, bit does anyone know how these new laws can help inthis situation?
Sounds good in theory? But the whole thing has fallen through and they've both given up on the idea for now.
BILs studio flat has only 58 yrs on lease, they've been speaking to 'a solicitor' recommmended by estate agent. who I think has spoken with leaseholder and come backe with a price to extend of £44k. This is on a small studio flat worth a little more than £100k and £60 pa ground rent!
Sadly my sister and her partner are not well off and not very wise to worldly things so I've offered to help try and sort this out with a view to get them moved in together.
Further background, my sister wants to sell her flat with issues: shared ownership which is not so straightforward to extricate from (and her equity now turns out a lot less than she was expecting), and terrible neighbour problems (local housing association houses people with mental health issues upstairs who regularly call the police on her!
So. You can imagine things are not simple, and my sister and partner don't have too much ready cash to throw at problems. This often means they sit on things making them worse over time. E.g I believe BiL bought his flat in cash from an inheritence, no mortgage, around 15 yrs ago, which would have meant his lease was at 72 yrs already. But he can't recall being advised this was an issue or to look to extend it at any point or negotiate a lower purchase price. Like I said, not very worldly and prone to receiving poor advice.
There are already some very useful threads on PH and elsewhere thagt talk about ways to extend leases that should not cost anything like that amount, but the process still will be lengthy and costly.
I'm going to sit down with them get all this on the table, and look at creating a plan, a budget and help work out what they need to do even if its going to take a while to resolve.
With regard to lease extension I'm going to suggest engaging a good surveyor specialised in extensions and negotiations. I see there is new legislation that helps leaseholders, bit does anyone know how these new laws can help inthis situation?
prand said:
My sister and brother in law are trying to sell both their properties to joint buy a larger place for themselves.
Sounds good in theory? But the whole thing has fallen through and they've both given up on the idea for now.
BILs studio flat has only 58 yrs on lease, they've been speaking to 'a solicitor' recommmended by estate agent. who I think has spoken with leaseholder and come backe with a price to extend of £44k. This is on a small studio flat worth a little more than £100k and £60 pa ground rent!
Sadly my sister and her partner are not well off and not very wise to worldly things so I've offered to help try and sort this out with a view to get them moved in together.
Further background, my sister wants to sell her flat with issues: shared ownership which is not so straightforward to extricate from (and her equity now turns out a lot less than she was expecting), and terrible neighbour problems (local housing association houses people with mental health issues upstairs who regularly call the police on her!
So. You can imagine things are not simple, and my sister and partner don't have too much ready cash to throw at problems. This often means they sit on things making them worse over time. E.g I believe BiL bought his flat in cash from an inheritence, no mortgage, around 15 yrs ago, which would have meant his lease was at 72 yrs already. But he can't recall being advised this was an issue or to look to extend it at any point or negotiate a lower purchase price. Like I said, not very worldly and prone to receiving poor advice.
There are already some very useful threads on PH and elsewhere thagt talk about ways to extend leases that should not cost anything like that amount, but the process still will be lengthy and costly.
I'm going to sit down with them get all this on the table, and look at creating a plan, a budget and help work out what they need to do even if its going to take a while to resolve.
With regard to lease extension I'm going to suggest engaging a good surveyor specialised in extensions and negotiations. I see there is new legislation that helps leaseholders, bit does anyone know how these new laws can help inthis situation?
Sounds like you doing exactly the right things. A Chartered Surveyor to advise is definitely the way forward. Sounds good in theory? But the whole thing has fallen through and they've both given up on the idea for now.
BILs studio flat has only 58 yrs on lease, they've been speaking to 'a solicitor' recommmended by estate agent. who I think has spoken with leaseholder and come backe with a price to extend of £44k. This is on a small studio flat worth a little more than £100k and £60 pa ground rent!
Sadly my sister and her partner are not well off and not very wise to worldly things so I've offered to help try and sort this out with a view to get them moved in together.
Further background, my sister wants to sell her flat with issues: shared ownership which is not so straightforward to extricate from (and her equity now turns out a lot less than she was expecting), and terrible neighbour problems (local housing association houses people with mental health issues upstairs who regularly call the police on her!
So. You can imagine things are not simple, and my sister and partner don't have too much ready cash to throw at problems. This often means they sit on things making them worse over time. E.g I believe BiL bought his flat in cash from an inheritence, no mortgage, around 15 yrs ago, which would have meant his lease was at 72 yrs already. But he can't recall being advised this was an issue or to look to extend it at any point or negotiate a lower purchase price. Like I said, not very worldly and prone to receiving poor advice.
There are already some very useful threads on PH and elsewhere thagt talk about ways to extend leases that should not cost anything like that amount, but the process still will be lengthy and costly.
I'm going to sit down with them get all this on the table, and look at creating a plan, a budget and help work out what they need to do even if its going to take a while to resolve.
With regard to lease extension I'm going to suggest engaging a good surveyor specialised in extensions and negotiations. I see there is new legislation that helps leaseholders, bit does anyone know how these new laws can help inthis situation?
On purchase, a mortgage co would have taken issue with the short lease and would have needed it resolved. I guess he didn’t have a survey as a competent surveyor should flag that too. If he did have a survey and it wasn’t flagged that would be worth perusing against the Surveyor.
I would also expect a competent solicitor to flag it - whilst it’s an issue of negative impact on value, a solicitor should know. I would quiz the Surveyor you engage about whether your BiL has a claim against the solicitor.
Also me may not need the cash - it could be sold with a discount equivalent to the cost of extending the lease, but with the lease extension already agreed for the purchaser to formalise on completion. May have to remarket the property though.
Hope it gets resolved, I’m not an expert, but there will be good surveyors out there able to assist.
Get in touch with www.leaseadvice.org it’s free
Edited by Good Plan Ted on Saturday 18th January 08:51
On the face of it £44k seems very costly.
https://www.lease-advice.org/ Is the place to start there is a statutory right to a leases extension at a statutory cost regardless of what the freeholder wants.
In 2011 I paid £19,000 to extend the lease on a flat then valued at £125k it had 63 years on lease, extended to 125 with peppercorn ground rent.
https://www.lease-advice.org/ Is the place to start there is a statutory right to a leases extension at a statutory cost regardless of what the freeholder wants.
In 2011 I paid £19,000 to extend the lease on a flat then valued at £125k it had 63 years on lease, extended to 125 with peppercorn ground rent.
Edited by nikaiyo2 on Saturday 18th January 09:24
Thanks All, good to see this advice.
I have suggested to my sister to consider kicking off negotiation ASAp not necessarily paying for an extension(they don't have access to money to pay now) but intend to complete and pay for it as part of the sale process. This way they keep control of the cost, rather than, as has been recommended now, drop the price against what is pretty much an imaginary number provided by the freeholder.
I have suggested to my sister to consider kicking off negotiation ASAp not necessarily paying for an extension(they don't have access to money to pay now) but intend to complete and pay for it as part of the sale process. This way they keep control of the cost, rather than, as has been recommended now, drop the price against what is pretty much an imaginary number provided by the freeholder.
This is an area to research before you agree anything.
Start here:
https://hoa.org.uk/advice/guides-for-homeowners/fo...
Marriage value is key here.
Start here:
https://hoa.org.uk/advice/guides-for-homeowners/fo...
Marriage value is key here.
I'm just starting this process on a leasehold maisonette. Fortunately we have 83 years left so no marriage issues yet.
This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
98elise said:
I'm just starting this process on a leasehold maisonette. Fortunately we have 83 years left so no marriage issues yet.
This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
My guess would be:This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
They are going to provide you with a report which gives you the answer for £675 + vat.
If you then want them to negotiate on your behalf with the Landlord they will charge you £450 + vat.
If agreement can't be reached and it goes to Tribunal and you want them to act on your behalf, you'll need to come back to them for another quote, or they'll charge an hourly rate.
JQ said:
98elise said:
I'm just starting this process on a leasehold maisonette. Fortunately we have 83 years left so no marriage issues yet.
This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
My guess would be:This website was very helpful...
https://www.lease-advice.org/advice-guide/lease-ex...
First of all there are on line calculator that should give you a reasonable idea of what the extension should cost. Approaching the freeholder direct will result in a high valuation.
If the calculated cost looks OK then you need to engage a valuer and a solicitor. Ideally find both who specialises in lease extensions.
This company were recommended on another thread (for valuations) https://www.apassociates.org/
https://www.pistonheads.com/gassing/topic.asp?h=0&...
They have just quoted me but at the moment I'm a bit confused as to what they are providing! The quote was "Our fee for a valuation would be £675 plus VAT and that involves inspecting the flat, studying the lease and providing a report. If we were needed to agree the final premium our fee would be £450 plus VAT – This excludes and work for Tribunal."
I'm not sure what the difference is between the report, the premium and the tribunal!
I've found a local (to me) solicitors who specialises in leaseholds and they've quoted about 2k, plus a couple of hundred for incidentally and disbursements.
https://leaselaw.co.uk/
Fortunately they know the landlord and in their opinion it will be a simple process.
They are going to provide you with a report which gives you the answer for £675 + vat.
If you then want them to negotiate on your behalf with the Landlord they will charge you £450 + vat.
If agreement can't be reached and it goes to Tribunal and you want them to act on your behalf, you'll need to come back to them for another quote, or they'll charge an hourly rate.
That makes the solicitors quote sound expensive if all they are doing is the legal side. The original conveyancing was only £1200 with my usual solicitors.
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