Is the lease on your property nearing the 80 year mark? If so, then it might be worth extending or buying the freehold!

publication date: Sep 10, 2009
 | 
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books
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With mortgage lenders being very particular about who and what they lend on at the moment and many properties at their lowest value for some years, if you live in a leasehold property it might be worth investigating extending your lease, or even buying the freehold.

The key time to extend your lease is when it’s heading towards 80 years being left on the lease as this is when:-

1. Not as many lenders will lend, therefore restricting who you can sell to, so it might be harder to sell and people are likely to offer lower prices.

2. The nearer to the critical 70-80 years left on your lease the more it might cost you to extend it.

Are you eligible to extend your lease?
If you have owned your leasehold property for at least two years, then you have a legal right to force the freeholder to sell, at a reasonable price, a lease extension of an additional 90 years. Or if enough of your leasehold neighbours are keen, you can legally compel the freeholder to sell the freehold to you so you can control the lease.

Why is now a good time to extend the lease?
The cost of extending your lease will depend in part on the value of your property, so if you look to extend your lease while prices are lower, then it should cost less to do it.

What is the cut off point for extending a lease?
Ideally you should look to extend a lease when there are still 80 or more years left on the lease. Below 80 years, there is an additional valuation (called Marriage Value) which you have to pay.

Need more information?
For more information about leasehold and freehold properties, call us on 0845 838 1763 or contact us via email.

Need help with a property problem? Have a question? Why not call Designs on Property on 01652 641 722 or Contact Us via email.
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