Should I extend my lease or wait for the freeholder to offer to sell me the freehold?

by The Chartered Surveyor

Question

 

I am a leaseholder of a flat within a block of 6. As of this month my lease has 83 years remaining. I am looking to sell within the next two years and am unsure whether to pay out to renew the lease or put it to market as is.

 

The other consideration is that our freeholder has indicated to me in writing that upon the renewal of the last remaining short lease (one flat only has less than 80 years) he will offer the freehold to the leaseholders for sale. Of course there is no date for this as the elderly occupant has been there some time!

 

I wouldn’t want to be in a situation where I renew the lease now only to have a chance to buy the freehold in 18 months’ time. I’m also conscious of the fact I may not get the opportunity at the freehold before I wish to sell and that letting the lease slip below 80 years could impact on the sale price.

 

Your advice would be most welcome!

 

Answer

 

The answer here may lay in collective enfranchisement. Under the Leasehold Reform, Housing, and Urban Development Act 1993 lessees have the right to collectively purchase the freehold to their building. There are various qualifying criteria; particularly, you will need at least half of the lessees to participate.

 

The first step will therefore be to talk to your fellow lessees. If you have enough people who are interested in participating, and you meet the other various criteria (best confirmed with your appointed surveyor or solicitor), you do not need to wait for your landlord to offer the freehold for sale.