Lease Extensions - Less Than 60 Years Left

[inflating]

The Direct Gov site won't give a quote for the cost of a lease extension where the lease has less than 60 years to run

Anyone here any tips or advice on what the price is likely to be - for 60 years the price was £10K to £11K (annual GR £28, lease 99yrs from 1970) but I wonder how much more it would be approximately for a lease of 58 or even 57 years left?

I want to determine whether a flat I have my eye on is anything like good value after the cost of the new lease is added in

[ DirectGov site http://www.direct.gov.uk/prod_consum_dg/groups/dg_digitalassets/@dg/@en/documents/digitalasset/dg_195423.html ]

Edited November 15, 2011 by inflating

[Mr. Piddle]

The Direct Gov site won't give a quote for the cost of a lease extension where the lease has less than 60 years to run

Anyone here any tips or advice on what the price is likely to be - for 60 years the price was £10K to £11K (annual GR £28, lease 99yrs from 1970) but I wonder how much more it would be approximately for a lease of 58 or even 57 years left?

I want to determine whether a flat I have my eye on is anything like good value after the cost of the new lease is added in

[ DirectGov site http://www.direct.gov.uk/prod_consum_dg/groups/dg_digitalassets/@dg/@en/documents/digitalasset/dg_195423.html ]

Try http://www.tenancy-agreements.co.uk/lease.php its more detailed and probably more accurate

[davidg]

The Direct Gov site won't give a quote for the cost of a lease extension where the lease has less than 60 years to run

Anyone here any tips or advice on what the price is likely to be - for 60 years the price was £10K to £11K (annual GR £28, lease 99yrs from 1970) but I wonder how much more it would be approximately for a lease of 58 or even 57 years left?

wow that's a lot, just bought the lease on a flat I own and it was a couple of thou I think. GR was 600 quid/yr with 75 years to run.

[inflating]

Try http://www.tenancy-agreements.co.uk/lease.php its more detailed and probably more accurate

Thanks, don't know exactly what goes in all the fields there but ballpark seems to be £9K to £18K to extend it to 125 years

DavidG

Yes when the lease is less than something like 75 or 70 years the cost goes up a lot due to marriage values and various factors which are mostly revolve around the perceived increase in value of a leased property with a longer lease

Some will tell you any leased property or flat can be bad news if major repairs or mandatory repair bills are imposed on the lessee (the tenant of the flat who has the lease, although they call them owner-occupiers!) by the lessor or freeholders. So a leasehold flat isn't always a good idea, and I have reservations about them. Share of freehold I think is better

Edited November 15, 2011 by inflating

[tim123]

wow that's a lot, just bought the lease on a flat I own and it was a couple of thou I think. GR was 600 quid/yr with 75 years to run.

are you aure that you don't mean annual maintenance charge is 600 pounds pa.

That has no effect on he lease value

[Mr. Piddle]

Thanks, don't know exactly what goes in all the fields there but ballpark seems to be £9K to £18K to extend it to 125 years

The yield is usually 4.44 and the marriage value usually 50. The value of the flat as is and with lease extention is guess work as far as this is concerned - When you really want to apply for a lease you will have to ask a Chartered surveyor to give you those figures. The calculator is only as a guide anyway.

I think leases sound like a pain as you are always living under someone elses control.

Good Luck

Edited November 15, 2011 by mason

[Freeholder]

Try this site. http://www.lease-advice.org/default2.asp

[inflating]

The yield is usually 4.44 and the marriage value usually 50. The value of the flat as is and with lease extention is guess work as far as this is concerned - When you really want to apply for a lease you will have to ask a Chartered surveyor to give you those figures. The calculator is only as a guide anyway.

I think leases sound like a pain as you are always living under someone elses control.

Good Luck

Thanks, btw I'm no lease fan at all

Try this site. http://www.lease-advice.org/default2.asp

Thanks

[numpty]

Have a look at this

http://www.landlordzone.co.uk/forums/showthread.php?11080-Approx-valuation-model-for-lease-ext

The guy who posted this owns large chunks of freehold ground rents in south east london and really knows his stuff

[General Melchett]

However, as my dad used to say, back when he was a little bit more rational about house prices:

What you have to ask yourself is why would I want to spend my hard-earned on this particular property, when there are so many other options available that dont have such blights on them?

IMHO, short leases, like so much else, are for the vendor to sort out before putting something up for sale. If something like this were easy, cheap (or even possible) why would they not do so? If they havent sorted them out, it is rational to assume it is going to be neither easy, cheap, or indeed perhaps possible.

[inflating]

Have a look at this

http://www.landlordzone.co.uk/forums/showthread.php?11080-Approx-valuation-model-for-lease-ext

The guy who posted this owns large chunks of freehold ground rents in south east london and really knows his stuff

thanks

However, as my dad used to say, back when he was a little bit more rational about house prices:

What you have to ask yourself is why would I want to spend my hard-earned on this particular property, when there are so many other options available that dont have such blights on them?

IMHO, short leases, like so much else, are for the vendor to sort out before putting something up for sale. If something like this were easy, cheap (or even possible) why would they not do so? If they havent sorted them out, it is rational to assume it is going to be neither easy, cheap, or indeed perhaps possible.

Yes fair points but in this case the vendor doesn't have that chunk of money, I think

[Mrs Bear]

The Direct Gov site won't give a quote for the cost of a lease extension where the lease has less than 60 years to run

Anyone here any tips or advice on what the price is likely to be - for 60 years the price was £10K to £11K (annual GR £28, lease 99yrs from 1970) but I wonder how much more it would be approximately for a lease of 58 or even 57 years left?

I want to determine whether a flat I have my eye on is anything like good value after the cost of the new lease is added in

[ DirectGov site http://www.direct.gov.uk/prod_consum_dg/groups/dg_digitalassets/@dg/@en/documents/digitalasset/dg_195423.html ]

Might be worth checking whether the freeholder is contactable. Vendors will often extend the lease before selling, if only because a short lease is often far harder to sell and very likely unmortgageable. If they haven't extended it, it could be that the freeholder is absent, which makes the whole process more lengthy and complicated, although I think you do still have the right to extend.

Don't know where you're looking, but there are an awful lot of absentee freeholders in London and I know personally of a case recently where a previously approved mortgage was withdrawn for that very reason, although the EA said that a few years ago lenders wouldn't have given a toss.

[inflating]

Might be worth checking whether the freeholder is contactable. Vendors will often extend the lease before selling, if only because a short lease is often far harder to sell and very likely unmortgageable. If they haven't extended it, it could be that the freeholder is absent, which makes the whole process more lengthy and complicated, although I think you do still have the right to extend.

Don't know where you're looking, but there are an awful lot of absentee freeholders in London and I know personally of a case recently where a previously approved mortgage was withdrawn for that very reason, although the EA said that a few years ago lenders wouldn't have given a toss.

Yes good point!

My calcs from Numpty's link suggest lease ext £9580, which is too much, the vendor won't reduce sufficiently for me to feel safe buying it. No one else thinks it's a good buy either, it's been on the market a few months now (although it's cheap-ish for the area N'tonshire). Vendor won't come down in price as they are hopeful someone will buy it as it is because it is a bit cheap, but so far no bites... so they may have to drop it more. On the other hand, some just withdraw and wait, believing prices will rebound in the spring etc etc, either way I'm going by my head not my heart so not going to be tempted