Questions about Right to first refusal.

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    Questions about Right to first refusal.

    L has decided to sell his freehold,5 long leases,L owns and lives in one flat.Going to offer T including himself the RTFR! hopefully all the other T will want to buy in,then it will be split 5 ways(5 shares)
    If T are not interested the L is going to sell to an outside company.
    been advised its worth 15-20k.an outside company are interested if the T are not.
    1, If the T do buy in how long will the process take,ie when will the L get the money?
    2, Who pays the L costs?
    3, On the section 5 notice does the L state the price he wants?
    4, 1 of the flats are not allowed to sublet can a premium be added to the purchase price to reflect this,say 5k?
    5, is it better to go to auction,rather than sell to the company already lined up?
    Thank you

    #2
    1. Depends on whether L goes to sell at auction or by private treaty.
    2. T does in any event unless it's by private treaty and L does not so require (NB: this never happens in real life!)
    3. Depends on whether L goes to sell at auction or by private treaty.
    AUCTION: no.
    PRIVATE TREATY: yes.
    4. No. The flat's value is not really affected. Even if it is, any effect on f/r's value is neutral no matter which sale procedure L follows- because any increase in it already benefits L and will therefore equally benefit whoever buys.
    5. Who knows? It depends on what bids are made at auction.
    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).

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      #3
      Thank you very much Jeffrey.
      If the T bought by private treaty how long would it take?
      How much would the T cost be roughly? Are we talking hundreds or thousands?

      Comment


        #4
        Originally posted by hollyhead View Post
        If the T bought by private treaty how long would it take?
        Depends! I'd not expect it to take more than a month, if you've already formed a new company.

        Originally posted by hollyhead View Post
        How much would the T cost be roughly? Are we talking hundreds or thousands?
        Sale: maybe £300-£400?
        Purchase: ditto.
        Each is plus VAT @ 20% and disbursements (chiefly at HMLR- copies, search, registration).
        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
          Originally posted by hollyhead View Post
          Thank you very much Jeffrey.
          If the T bought by private treaty how long would it take?
          How much would the T cost be roughly? Are we talking hundreds or thousands?
          It is depends situation. If the notice is served and the response straightforward and undisputed, the title clean and easily conveyed, then after the section 5 process is completed it could be a matter of a few weeks in my experience. That said it has been done in matter of days though at substantially higher cost.

          As to the best method unless there are reserved areas and/or development potential, those who should be most willing to pay the highest price are residents. An auction would only raise the best price if there is sufficient interest, and there is always the risk that residents, faced with an auction, may back out and, on the day the property is undersold, or worse still not sold at all.

          Your local advisor understanding the market is best placed to advise you.

          As to cost then that too depends althougn for a simple transaction £1000 or so, plus disbursements, for the entire process is a low end cost.

          It is always best that the freeholder, who is also a leaseholder ensure that while it takes some of the value out of the freehold, that they extend or grant a lease of 999 years at a peppercorn ground rent, and take the opportunity to optimise their lease, if the need is there and that does not conflict with the terms of other leases. EG you could remove redundant clauses, introduce restrictions re sat dishes, wood floors, if underletting or assignment had a restrictive clause requiring landlord's consent or a separate deed, that might be amended or a standard deed included in the lease, and sensible notice fees introduced eg £35 on 1-4-2011 plus RPI every 1-4. That would serve as a future model for other lease extensions and make a future sale simpler.
          Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

          Comment


            #6
            Thank you both.
            Leaseholdanswers you must be a mind reader..Re: your last paragraph,need I say more, the matter is already in the hands of my brilliant solicitor!
            I'am rubbing my hands with glee at the thought of being a simple leaseholder again!

            Comment

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