Buying the lease on your home cost

vote quimby

vote quimby

Striker
My dad has decided he wants to buy the lease on his house. Was built in the 60s but has decided now is the right time for him to buy the lease. Reckons its better for me and my brother once we inherit the house. I dont see what the rush is personally. Anyway, hes been quoted just over 6 grand to do so. We'll end up going thirds on cost. This seems expensive but to be honest, I've got no knowledge of this. Anyone on here clued up or got experience in this, would be most grateful, thank-you.
 


vote quimby said:
My dad has decided he wants to buy the lease on his house. Was built in the 60s but has decided now is the right time for him to buy the lease. Reckons its better for me and my brother once we inherit the house. I dont see what the rush is personally. Anyway, hes been quoted just over 6 grand to do so. We'll end up going thirds on cost. This seems expensive but to be honest, I've got no knowledge of this. Anyone on here clued up or got experience in this, would be most grateful, thank-you.
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If its on a 99 year lease which lots of them are you would struggle to get a mortgage on it.
The longer he leaves it the more the lease will be to buy as well.
 
vote quimby said:
Yeah, its a 99 year. So basically, if we don't buy it, it'll be harder for us sell later on?
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if you don't extend lease definitely as will only get cash buyers.
as an example some bungalows up street from my Mam built in 60s one with lease with 40 years left was up for 55k last year a one nearby was freehold and up for twice this.
 
faith brothers said:
if you don't extend lease definitely as will only get cash buyers.
as an example some bungalows up street from my Mam built in 60s one with lease with 40 years left was up for 55k last year a one nearby was freehold and up for twice this.
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Gotcha. Any idea how much it usually costs? My dad is the type who will just accept the first offer every time. He's a nightmare. Literally only found out he was doing this a couple days ago then hit me with the price today.
 
vote quimby said:
My dad has decided he wants to buy the lease on his house. Was built in the 60s but has decided now is the right time for him to buy the lease. Reckons its better for me and my brother once we inherit the house. I dont see what the rush is personally. Anyway, hes been quoted just over 6 grand to do so. We'll end up going thirds on cost. This seems expensive but to be honest, I've got no knowledge of this. Anyone on here clued up or got experience in this, would be most grateful, thank-you.
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What is the approximate value of the house (if freehold)?
 
vote quimby said:
Between 100,110 maybe. Three bedroom link.
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On that lease term you are looking at around 30% less.
That's for mortgage purposes if you were selling using the RICS guidance.
It's a while since I did valuation work for the purchase of a freehold interest but 6k sounds cheap. The figure is calculated using marriage value and other factors and can get complicated.
If you disagree with the price you can appeal but could end up in a tribunal which is a lengthy process and not really worth doing.
 
tenpins said:
On that lease term you are looking at around 30% less.
That's for mortgage purposes if you were selling using the RICS guidance.
It's a while since I did valuation work for the purchase of a freehold interest but 6k sounds cheap. The figure is calculated using marriage value and other factors and can get complicated.
If you disagree with the price you can appeal but could end up in a tribunal which is a lengthy process and not really worth doing.
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Class mate. Thanks very much
 
Once the lease has less than 80 years to run, the cost of buying/extending increases significantly due to the addition of marriage value.

Also you may be aware that the government has pledged to bring in legislation to put into effect a recent Law Commission report into Leasehold Enfranchisement with the aim of simplifying the process and reducing costs as well as abolishing leaseholds for houses. Whether that actually comes into effect, who knows?
 
Something to add, when the unfortunate time comes you can’t extend the lease until you have owned it for 2 years and as mentioned once below 80 years the price rockets.

we bought our house when it had 82 years left on it so we made the sellers extend the lease by another 25 years as effectively they couldn’t sell the house without it as it would cost the buyer a fortune to extend once below 80 years. So many on the estate have gone up for sale, sold quick only to be pulled off the market
 
Reubens tasche said:
Something to add, when the unfortunate time comes you can’t extend the lease until you have owned it for 2 years and as mentioned once below 80 years the price rockets.

we bought our house when it had 82 years left on it so we made the sellers extend the lease by another 25 years as effectively they couldn’t sell the house without it as it would cost the buyer a fortune to extend once below 80 years. So many on the estate have gone up for sale, sold quick only to be pulled off the market
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I believe that requirement no longer exists
 

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