When it comes to selling properties, leaseholders often wonder whether they should sell their property with its existing lease or extend and sell it with longer lease period. Although this actually rests on personal discretion and preferences, there are a few general tips to consider with the extension of the lease process and the realty market itself. Find out about some of the top things to consider while selling leased homes.
In case your lease is over 80 years, you can get an informal lease extension for a specific amount. It could be quite high for a short time in case the lease falls below that time span. Although that can also be achieved with a lease over 70 years, the shorter your lease is the tougher it will get for you.
You should also consider whether your freeholder wants to grant you a lease extension, without any need to serve S42 or some other notice. It is best that you write to the management firm or freeholder and ask about the total expense of an informal extension. The information could be offered to you clearly, and you would either be instructed to serve a notice or pay for its surveyor so that you can be made an offer. In some cases, you could be made an offer directly.
Formal Route expenses
When you go the S42 way, your fees cannot be kept lower than 4,000 – 5,000 pounds. This is because the solicitor’s and surveyor’s costs have to be covered, as well as the same expenses for your property freeholder. Any informal offer that is made will contrast the things that can be achieved through the formal process, along with the expenses.
Short lease selling
If you do not wish to extend the lease before selling, you have the alterative of selling the property with the existing lease. You are permitted by the Act to extend the S42 lease to buyer, but the purchaser is likely to knock off from your selling price when he considers the extension costs, professional expenses and the stress and inconvenience that he has to endure during the process. If your property is on a very short lease, it would be better that you extend it on your own, make the premium payments yourself and sell the home with the longer lease period. You can get a valuation done by a surveyor if you have doubts.