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I have had a lease extension valuation done on my flat by a local company the problem is the difference between best and worst scenarios is £7000. How can the difference be so great
Remaining lease 53 years from 99 year lease
Ground rent £15
Valuation with new lease £75000
Valuation without new lease £50000
I have been informed by this company that the lease extension would be anything between £11000 and £18000 before solicitors fees etc
That does not sound too bad. Unfortunately that’s how much they cost.
Eye99 The problem is the differential between the figures £11k and £18k . Why is it so wide
Did you check the actual value on the Lease Extension Valuation?
Some freeholders just make up their own figure, stating their is added value in the area!!!
These are the figures my specialist lease extension valuer (re Alep site) worked out after viewing the property and doing all the back ground checks
I would check what comparable flats in same location with leases over say 100 yrs have sold for recently
Ask for a copy of the calculations and assumptions made, you will then be able to see which variabls are impacting on the suggested price, also go on the lease site and use their calculator to cross check the figures.
Unfortunately on top of the lease premium you will also have to pay for your and the freeholders survey and legal fees. And the freeholder’s fees are always 3 times more than mine.
Sadly - by the stage that anyone becomes interested in extending a lease - you are already over a barrel as the property value will be progressively falling (as a percentage of market value).
The sooner you do it the less it costs - unless say you have over 90 odd yrs remaining.
Why not just ask them the reason for the price difference they are quoting you. On back of envelope calculation should be around 11k-14k but that does not include legal expenses. Also depends where the flat is etc.
I estimate, using modern calculations, that the premium should be between £12,000 and £13,000 as a maximum.
The valuer has given you a margin of error of +/- 32%, which is unrealistic. You must see the calculations to establish their methodology.
Remember to make your offer on the low side, I'd say £11k. If you don't get a counter-notice within 2 months of your s42 notice you will be given a new lease with a premium being as per your s.42 notice original offer.
Ashley ConnellLease Extension Solicitor at Hetts