Selling a leasehold flat with a short lease?
As experienced Freeholders we are looking to purchase leasehold Flats throughout England and Wales with a focus on leases with less than 80 years to run. These types of properties can often be very difficult to sell in the current market with mortgage finance difficult to find for leasehold flats with less than 70 years remaining on the lease. In some instances flats will be unsaleable to the general market. We are able to provide you with a guaranteed cash offer for your flat regardless of the length of its lease.
Your questions answered about selling short lease flats:
The Landlord is entitled to receive compensation for the loss of the ground rent income to be paid under the current lease, together with the loss of the right to receive the value of the flat at the end of the current lease. In simple terms this is the difference in value of the Landlord’s interest today under the present lease, and the value of his interest after the grant of the new lease with the additional 90 years. He is also entitled to receive a share of the marriage value and compensation for loss arising from the grant of the new lease.
The need for your lease extension arises because as your lease gets shorter the value of your flat (or maisonette) will go down compared to a similar flat which has a long lease of, say, 100 years or more. This reduction in value is much less pronounced in the early years, but it’s when your lease gets to less than 80 years remaining that the real problems start.
We are experts at buying leasehold property where the lease length is below 80 years unexpired. At this point the flat’s value really starts reducing, and it steadily becomes less saleable. This is because the cost of purchasing a lease extension becomes significant and continues to rise, the flat will have less appeal to buyers, and mortgage lenders are increasingly unwilling to lend on flats with short leases.
So the longer you put off extending your lease means:
The flat will become relatively less valuable
The flat will become more difficult to sell on the open market
The cost of purchasing a lease extension will continue to increase
If you are selling a flat or maisonette with a short lease we would like to hear from you. We purchase all leasehold properties with short leases. We will be able to make you an offer the same day you call us and will buy your lease in its current form. Unlike our competitors we will not need to write to your freeholder to find out what your lease will cost to be extended.