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Thread: Lease extension question

  1. #1

    Lease extension question

    My mum has a leasehold flat which has about 86 or 87 years left on it. We want to extend the lease before it gets below 80 years and have been offered two methods by the freeholder; formal and informal.

    Formal:
    Employ your own surveyor and serve notice via a solicitor with the surveyor's quote.

    Informal:
    Fill out a form, get a price, pay their legal fees.

    Is there generally a price difference between these two routes? Or is there a meaningful benefit by choosing one route Vs another?

    If it makes a difference we would probably opt for a 90 year extension rather than topping it back up to 125 years.

    Thank you in advance for the help and apologies for butchering the summary as I'm sure it's worded different for those in the business.

  2. #2
    Master robcuk's Avatar
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    We did this in 2018 via the informal route.
    No issues and straightforward.

  3. #3
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    Did you sort this? Was it fairly painless?

  4. #4
    Quote Originally Posted by robcuk View Post
    We did this in 2018 via the informal route.
    No issues and straightforward.
    Thanks for the reply. Is there any reason why you went the informal route? I'm wondering if a lease ext quotation from a surveyor will be different than from a freeholder.
    Quote Originally Posted by Middo View Post
    Did you sort this? Was it fairly painless?
    No sorry, I missed the original reply from robcuk and the paperwork is still on my desk.

  5. #5
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    Good luck, we have found property we like and it leasehold, not my preferred option but the option to buy out isn't that expensive I discovered today.

  6. #6
    Quote Originally Posted by Middo View Post
    Good luck, we have found property we like and it leasehold, not my preferred option but the option to buy out isn't that expensive I discovered today.
    Usually you only have the option to buy out if it's a house or a flat in a converted house. Hampstead Garden Suburb has quite a few houses which are leasehold (so as to prohibit lofts etc) and people over time have bought them out once it became a conservation area. On this it's for a flat in a block so there won't be an option to buy out, just top back up to what it originally was or add 90 years.

    I think you have to own the property for at least two years before applying to extend a lease, not sure if it's the same when buying one out. Some people when selling get a price for the lease (usually through the formal route) and then assign the right to the new buyer after exchange/completion. Good luck with your property.

  7. #7
    Grand Master
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    I've bought two freeholds. Both times I also got a quote for extending which was so close to the sale price it wasn't worth considering. Is this an option for you?

  8. #8
    Quote Originally Posted by TaketheCannoli View Post
    I've bought two freeholds. Both times I also got a quote for extending which was so close to the sale price it wasn't worth considering. Is this an option for you?
    No, it's a flat in a block so no option. My mum is happy to extend, I'm just trying to see if there's a cost difference between the two routes.

  9. #9
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    Quote Originally Posted by wileeeeeey View Post
    Usually you only have the option to buy out if it's a house or a flat in a converted house. Hampstead Garden Suburb has quite a few houses which are leasehold (so as to prohibit lofts etc) and people over time have bought them out once it became a conservation area. On this it's for a flat in a block so there won't be an option to buy out, just top back up to what it originally was or add 90 years.

    I think you have to own the property for at least two years before applying to extend a lease, not sure if it's the same when buying one out. Some people when selling get a price for the lease (usually through the formal route) and then assign the right to the new buyer after exchange/completion. Good luck with your property.
    Good info, thankyou.

    Sorry the the thread burgle OP.

  10. #10
    Master robcuk's Avatar
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    Quote Originally Posted by wileeeeeey View Post
    Thanks for the reply. Is there any reason why you went the informal route? I'm wondering if a lease ext quotation from a surveyor will be different than from a freeholder. No sorry, I missed the original reply from robcuk and the paperwork is still on my desk.
    Apologies, we went the informal route as the Housing Association made it easy and offered a low amount to do it. Our neighbour decided to go down the formal route and it cost him much more than us and also much more in legal fees.

  11. #11
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    Wiley can you not fill in the form get their quote and then decide?

    The formal route usually uses some sort of formula from what I remember and you can attempt to estimate the cost online on certain websites. So you could compare that estimation vs. their quotation to you. I am guessing a surveyor is required as you need valuations pre extension and post. But you could have a go at guessing that to get the approximation.

    When I have done this I have always gone informal as it feels more amicable and I sense checked their quote with above methods. (You can also search land registry to see what others paid in the block if memory serves correctly!)

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