Jump to content
House Price Crash Forum

Archived

This topic is now archived and is closed to further replies.

Propertyduck

Lease On A Flat

Recommended Posts

Hi

Sorry if this is not in the correct forum could mods move if needed, thanks

This is probably a simple question but as I have never bought leasehold I don't have a clue..............................

My brother bought a flat twenty years ago with a 99 year lease, he has been told he can buy a 90 year lease extension for around 10k. My question is this.......... If he does not buy the extension but just lets his old lease run what happens to his flat in 79 years? Does the person that owns the freehold just take over everything on the land including his flat? I know its not relevent to him but it could be to his grandchildren :(

Thanks :)

Share this post


Link to post
Share on other sites

I used to live in a flat. At the look of it, a 90yr extension for £10k sounds OK, but he may be able to get it down a bit more.

At the end of a lease period, a new one would have to be thrashed out. But in 79 yrs, the ground rent wouldn't be less than £100 per year (which it probably is at the mo') but quite a bit more!

The real problem with a diminishing lease period is that banks and BS won't lend on one with less than 60 - 65 yrs to go (depends on the bank), i.e. 40 yrs left on the lease AFTER the mortgage repayments have finished. This makes a l/hold property unsaleable to anyone other than a cash buyer if the unspent period is low.

If its another 90yrs on offer, i.e. lease would be 169 yrs, it may be worth it. Check the small print, get some independent advice and check how much the ground rent would be. At mine a few yrs ago, the annual ground rent was £35.

Share this post


Link to post
Share on other sites
I used to live in a flat. At the look of it, a 90yr extension for £10k sounds OK, but he may be able to get it down a bit more.

At the end of a lease period, a new one would have to be thrashed out. But in 79 yrs, the ground rent wouldn't be less than £100 per year (which it probably is at the mo') but quite a bit more!

The real problem with a diminishing lease period is that banks and BS won't lend on one with less than 60 - 65 yrs to go (depends on the bank), i.e. 40 yrs left on the lease AFTER the mortgage repayments have finished. This makes a l/hold property unsaleable to anyone other than a cash buyer if the unspent period is low.

If its another 90yrs on offer, i.e. lease would be 169 yrs, it may be worth it. Check the small print, get some independent advice and check how much the ground rent would be. At mine a few yrs ago, the annual ground rent was £35.

Thanks for that :D

His ground rent is £410 per annum and he was told if he took the extension the ground rent would be scrapped. It looks like a no brainer to me but just finding everything out for him in the meantime

Thanks

Share this post


Link to post
Share on other sites

My wife used to be a private sector housing advisor for the council. I think the lease holder remains a tenant as they are not owners but tenants and you have to agree a rent with the freeholder until the lease problem is sorted. I don't think a the longlease holder himself can be evicted.

Share this post


Link to post
Share on other sites
My wife used to be a private sector housing advisor for the council. I think the lease holder remains a tenant as they are not owners but tenants and you have to agree a rent with the freeholder until the lease problem is sorted. I don't think a the longlease holder himself can be evicted.

Thanks very much for the info, much obliged :)

Share this post


Link to post
Share on other sites
Thanks very much for the info, much obliged :)

I've just checked with my wife and she says, I'M WRONG ABOUT EVICTION. Unless you have a ligitimate dispute concerning the terms of the lease they can issue you the lowest form of rental, aggrement which is `assured shorthold' giving you one months notice to quit. after that period you have squaters status. I'm sorry if I misled you.

Share this post


Link to post
Share on other sites

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 395 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.