If you own a flat or a leasehold house, you will own a lease for a specified number of years. These typically range from 99 to 999 years. The length of a lease can have an impact on the value of your property, especially as the lease approaches 70-80 years remaining. This is because it is almost impossible to obtain a mortgage on a property with fewer than 70 years remaining on the lease.
A flat built in 1985 is granted a lease of 99 years. In 2012, there is now only 72 years remaining on the lease and the value of the flat will be reducing quickly.
Why is this an issue?
When you come to sell, a buyer will want to ensure the lease is sufficient and anything close to 70 years and certainly anything below 70 years may put them off purchasing. This can be and is often a deal breaker.
The good news:
Providing you have been living in your property for 2 years, you have a legal right to a 99 year lease extension.
A lease extension will cost money, however to ensure that you are not paying too much, we have the skills and knowledge to calculate the correct amount to pay and if required help with any negotiations required with the freeholder.
Money saving tips:
Try not to leave this until you are selling the flat/house. If the freeholder thinks you need to renew urgently, it will significantly weaken your negotiation position and you may end up paying more.
You will also save money if you are able to renew prior to 80 years remaining due to a change in the way the lease extension fee is calculated.