Most of flat are 999 years from the same date but one flat has 160 (90 unexpired) years.
Buyers want to extend lease to 999 with a hold harmless letter. Is there a premium to be paid? Who should decide this?
There will be a big premium to do what you want . .A solicitor is needed for this to negotiate.
@Z114 You all own share of freehold and selling one of the flats with a low lease?
If you all own then I would think you can name your price or not charge anything. If you want to charge than a surveyor would give you an indication of value. The buyer could bring in their own surveyor and let negotiations begin via each party’s solicitor and end up meeting in the middle.
Thanks Colin, is this true where the buyer says it’s not and the sellers solicitor says it shouldn’t be a problem?
do you mean.the buyers want to extend the lease from 90 years to 999 years/
Yes thats what the want to do
90 years is hardly any thing .999 years is “almost” freehold and worth a lot more than 90 years There is a Freehold Advisory service that will give good advice
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Sorry I mean leasehold advisory service
As a rough guideline property with 100 years left on lease is worth roughly the same as equivalent freehold property. in real terms leases with 150 years on are just as good as 999 as will outlive any owner.
I haven’t come across many 999 leases myself.
I have some 999 year places with about 900 years left . I have had places offered to me with 150 or so years left but I would never consider them . Freehold is better of course as you have more control What I consider is the value to my children and granchildren, not how much longer I will live for . !!
I think if I had availability of a 900 lease this would be preferable if only to remove doubt to any buyer, but where I buy it’s just rarely an option, or the sums don’t stack up for me. I can only speak from residential perspective, not commercial.
I am happy to extend leases early on and it’s easy to get the length right up cheaply, and my kids can do that too should they ever need to. If the numbers work I’m happy.
There are online calculators that give an approximate value for the premium to be paid. The LAS one is here: Lease extension calculator - The Leasehold Advisory Service
Bear in mind that in addition to the premium you will have to pay both your own legal costs and the freeholders legal costs for the extension and probably a surveyors fee to fix the price.