Lease 62 years left; Chancery St James' extortionate premium

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    Lease 62 years left; Chancery St James' extortionate premium

    After deciding to sell my first floor flat I have reaslised that I have only 62 years left on my lease.

    I have contacted the company who owns my lease (Chancery St James) for a figure and they have quote me £10,300.00 plus leagal costs!

    My property is valued at around £80k. To me this seems excessive. What kind of rights do I have to contest this and how do I go about this.

    Any help would be much appriciated.

    #2
    Assuming the flat is worth £100k with a very long lease and neglible ground rent and the ground rent currently passing is say £25 pa annum then a premium of around £10k is not that far out

    My "back of the envolope" calculations would suggest around £9k to £10k for a 90 year ext ie a new 152 year lease at a peppercorn rent. Plus reasonable legal costs and valuation fees of the landlord

    Comment


      #3
      Thanks for your quick reply sgclacy.
      Unfortunately getting a lease extension is not going to enable me to sell for £100,000. I think that the maximum that it would go up to is probably £85 000 (if that) and therefore only a 5k increase. Does this have a bearing on how much the lease extension will cost? Also, my ground rent is £20 pa - don't know if this affects the cost too. It seems to me that it is going to leave me considerably out of pocket.
      Any more advice would be gratefully received.

      Comment


        #4
        For how long have you owned the flat, and why have you left it until now to extend? Really, doing it when the lease had > 80yrs. unexpired (i.e. at least 18yrs. ago) would have achieved a much better outcome; although, pre-1993, a leaseholder's statutory position was much weaker.
        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
        4. *- Contact info: click on my name (blue-highlight link).

        Comment


          #5
          After deciding to sell my first floor flat I have reaslised that I have only 62 years left on my lease.
          If you haven't actually bought it then don't unless the lease is first extended.

          If, as I assume, you did buy it, how long ago was that? If only recently then what did your solicitor say about lease length? Didn't he earn you of the possibility of having to find a substantial sum to extend the lease?
          RICHARD WEBSTER

          As a conveyancing solicitor I believe the information given in the post to be useful (provided it relates to property in England & Wales) but I accept no liability except to fee-paying clients.

          Comment


            #6
            Originally posted by Roert921 View Post
            After deciding to sell my first floor flat I have reaslised that I have only 62 years left on my lease.

            I have contacted the company who owns my lease (Chancery St James)
            Clarification:
            1. You already own the lease.
            2. Ch. St. J. owns the freehold reversion.
            JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
            1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
            2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
            3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
            4. *- Contact info: click on my name (blue-highlight link).

            Comment


              #7
              I bought the flat 6 years ago and, at that time, the solicitor whom I used did not inform me of any problem relating to the lease - which has now obviously left me with this problem as I would not have purchased it had I known. Up until 2 weeks ago I had given no thought to the lease length as my solicitor had not informed me of the importance of this.

              Comment


                #8
                It might be too late to complain- the time limit re breach of contract is usually six years- but you could nevertheless point out that he/she did not properly advise you of the need to extend. On the other hand, even then you bought only a 68yr. term; so surely that was drawn to your attention?
                JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                4. *- Contact info: click on my name (blue-highlight link).

                Comment


                  #9
                  I have no written documentation from the time I bought the flat from the solicitor stating his concern with regards to the length of the lease.

                  At the time I was a first time buyer so if I was made aware of any lease concerns verbally I would have tread very carefully. I believe I have been badly mis guided and advised.

                  Comment


                    #10
                    Originally posted by Roert921 View Post
                    I have no written documentation from the time I bought the flat from the solicitor stating his concern with regards to the length of the lease.

                    At the time I was a first time buyer so if I was made aware of any lease concerns verbally I would have tread very carefully. I believe I have been badly mis guided and advised.
                    Yes, you were. Did you buy:
                    a. for cash; or
                    b. financed by a mortgage advance?
                    If 'b', I wonder whether the mortgagee (lender) is aware of how short a lease it accepted as security! Why not ask it?
                    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                    4. *- Contact info: click on my name (blue-highlight link).

                    Comment


                      #11
                      I have a mortgage.

                      Will contacting the mortgage lender not rock the boat?

                      Do you think I might have good grounds to make a claim against the solicitor for failing to make me aware of this problem.

                      Many thanks for your help

                      Comment


                        #12
                        I'd contact the mortgagee. It won't do anything adverse to you (it might even thank you!) but:
                        a. its pockets are deeper than yours; and
                        b. it might do things to your possibly-negligent solicitors.
                        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                        4. *- Contact info: click on my name (blue-highlight link).

                        Comment


                          #13
                          Thanks again for your help and advice

                          Comment


                            #14
                            After approaching CSJ with regards to extending my lease, they responded quoting me in excess of 10k.

                            After taking advice from the The Leasehold Advisory Service I have decided to try and avoid initial legal costs by writing an informal letter to see if they will accept a lower offer.

                            However I have read somewhere that this might affect or stop a case going to a tribunial if things dont run smootly. Can anyone offer any advice with regards to this and also any disadvantages of this approach.

                            Many Thanks

                            Comment


                              #15
                              An informal approach, if marked as subject to contract and without prejudice to statutory rights, is- er- without prejudice to statutory rights.
                              JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
                              1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
                              2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
                              3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
                              4. *- Contact info: click on my name (blue-highlight link).

                              Comment

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