Leasehold questions

Ste · Not Work Safe Joined: 01 Sep 2002 Karma :

Is anyone able to explain about how collective enfranchisement works?

The property I'm looking at has about 60 years left on the leasehold. That doesn't bother me apart from in the way selling it would be difficult/impossible with less than 60 years if selling to someone with a morgage.

There is an offer from the freehold owner to extend the lease to 99yrs, but that would mean the ground rent would be 25 times more each year than it is if I didn't renew it.

After living there for two years, I'd be able to renew the leasehold with collective enfranchisement which I know very little about, other than what I've read so far and be told in legal jargon so far. Anyone able to explain it in laymans terms? How is the price for renewing it reached, I understand there are valuations done of the property and solicitors involved (bills for all of which go to the leaseholder Rolling Eyes

) but as it's regulated and controlled, how can I get an idea of how much renewing it would cost in 2/5/10 years time?

Also, am I right in saying that the terms of the lease stay the same if renewed with collective enfranchisement, so they wouldn't be able to decide to charge 25 times more for the ground rent?

Any help greatly appreciated. Smile

WildGoose · White Van Man Joined: 21 Mar 2002 Karma :

in short, wouldnt touch it with a barge-pole if i didnt need to

surely you have the flexibility to avoid anything with a leasehold on it?

why would you want to get involved in all those extra costs, ground rent, service charges, etc. bills can pop up from nowhere depending on what works need doing at various times
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sickpup · Old Timer Joined: 21 Apr 2004 Karma :

Ste · Not Work Safe Joined: 01 Sep 2002 Karma :

NSR Mick · World Chat Champion Joined: 26 Jun 2005 Karma :

Do you have any option to buy the lease?
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Ste · Not Work Safe Joined: 01 Sep 2002 Karma :

Yes, well, to renew it. It's offered with the option of renewing the lease back up to 99yrs but doing that would mean the ground was was 25 times what it is without renewing it.

Would also be able to renew it using collective enfranchisement which I understand to be regulated, rather than them just thinking of a number and seeing if the buyer will pay it which is what I've been told the offer to renew when purchasing is. Trying to find out about collective enfranchisement and exactly how the price would be reached but there doesn't seem to be info online about it other than in legal jargon which isn't any use. Confused

syl · World Chat Champion Joined: 05 Dec 2005 Karma :

Try this site:

https://www.lease-advice.org/

https://www.lease-advice.org/cegsframe.htm
https://www.lease-advice.org/cevaframe.htm
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Resurrection · Ballast Boy Joined: 08 Jun 2006 Karma :

If i have understood this correctly and i think i have then why dont you do what your gonna do i.e get it for the knockdown price with the ground rent at £10 do it up/live it in over a couple of years and see how the market is doing and then either sell it on as is fully explaining or just before you sell it renew it back to 99 years?

Res
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