Food & Drink1 min ago
Share of Freehold & short Leasehold
2 Answers
Had a good look through the archives but didn't find anything exactly answering my questions.
I am hoping to put an offer in on a flat in an old house that has been converted into a 8 properties. The tenure is a share of the freehold, and a leasehold. The leasehold has 72 years remaning of 99 years (when the building was converted, free / leaseholds set up etc).
My questions are - should I be worried that the leashold is so short?, can the freeholders collectively renew the lease? if so does this have any financial implication?, and if so what happens if say one freeholder decides they can't be bothered?
Thanks in advance :) James
I am hoping to put an offer in on a flat in an old house that has been converted into a 8 properties. The tenure is a share of the freehold, and a leasehold. The leasehold has 72 years remaning of 99 years (when the building was converted, free / leaseholds set up etc).
My questions are - should I be worried that the leashold is so short?, can the freeholders collectively renew the lease? if so does this have any financial implication?, and if so what happens if say one freeholder decides they can't be bothered?
Thanks in advance :) James
Answers
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James,
The block may have bought its freehold but don't assume that this particular owner was part of the deal. If they WERE, then they will be a shareholder in the freehold company and will easily be able to extend the lease. LIkewise, if you buy the property, you can also extend the lease.
There is a cost, only a few hundred pounds, and something that you can easily negotiate the seller to pay.
If this owner is not a shareholder, you should insist they serve a Section42 notice and extend the lease prior to your committing to a purchase. The law says you need to have owned the property for 2 years before you can do this, but the current owner can begin this and transfer the process to you via a deed of assignment.
We at Leasehold Solutions (www.leaseholdsolutions.com) frequently find that 72 years is short and many lenders won't be keen on lending money on such a short lease. So be wary.
If you need a solicitor or surveyor, there are vetted specialists at www.alep.org.uk, the Association of Leasehold Enfranchisement Practitioners.
The block may have bought its freehold but don't assume that this particular owner was part of the deal. If they WERE, then they will be a shareholder in the freehold company and will easily be able to extend the lease. LIkewise, if you buy the property, you can also extend the lease.
There is a cost, only a few hundred pounds, and something that you can easily negotiate the seller to pay.
If this owner is not a shareholder, you should insist they serve a Section42 notice and extend the lease prior to your committing to a purchase. The law says you need to have owned the property for 2 years before you can do this, but the current owner can begin this and transfer the process to you via a deed of assignment.
We at Leasehold Solutions (www.leaseholdsolutions.com) frequently find that 72 years is short and many lenders won't be keen on lending money on such a short lease. So be wary.
If you need a solicitor or surveyor, there are vetted specialists at www.alep.org.uk, the Association of Leasehold Enfranchisement Practitioners.
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