Selling A Flat On A Short-Term Lease?
You have decided to sell your home but your remaining lease term is making it difficult for buyers. Or an estate agent has advised you that your short lease will be a problem and something you should think about. A specialist lease extension solicitor can help you understand your options and give you advice on selling a flat with a short lease.
Is It Possible To Sell A Flat On A Short-Term Lease?
Yes, you can. However, you have many options and should seek expert guidance and advice from an estate agent and a specialist lease extension solicitor before making a decision.
An estate agent will assess your property and inform you about the impact of the short lease on the value. They also can tell you how much you could sell your flat for if it is not addressed. An estate agent can also help you determine how difficult it will be to sell your apartment due to the shorter lease term and other similar properties that might be available to buyers.
What’s A Short Lease For A Flat?
86 – 90 Years Will Be Difficult To Sell
Estate agents will tell sellers that selling a flat with a 90-year lease is difficult. Many buyers are aware that a lease with fewer years than the original term may cause problems. Even if the buyer doesn’t know it, a residential conveyance lawyer will review the lease and report to them. The lawyer will likely highlight the potential risks and suggest that the buyer should extend the lease.
Buyers Will Have Mortgage Problems If There Are 83-85 Years Left
A short-term lease makes it difficult to sell a flat. Many mortgage lenders won’t lend to leasehold properties with a lease term of 85 years or less. Many potential buyers wouldn’t be able to get a mortgage on the property. This results in a smaller pool of buyers. This may limit your options to cash buyers and investors. These buyers are more likely to negotiate a fair price for the property, using the short-term lease against you.
80 – 82 Years Left, The Buyer Will Have To Pay More For The Extension Of The Lease
Flats that are closer to 80 years in lease terms will be more difficult to sell. This is especially true if there are only 80-82 years left or if there would be less than 82 years before the sale is complete. The buyer would not be able to extend the lease unless they have been registered owners for at least two years. The lease would then have less than 80 years left. It is much more costly to extend a lease if the remaining term falls below 80 years. This will be disclosed to the buyer by their conveyancing lawyer.
If your lease has less than 82 years remaining, it is likely difficult to sell. Any buyer will likely negotiate hard to lower the purchase price. They will also need to wait two more years before they can extend the lease.
Lease Extension For 79 Years Or Less, The Lease Extension Will Be Significantly More Expensive
Buyers will be concerned if the lease term on your apartment is less than 79 years. A potential buyer may use this information to lower the purchase price. It is more costly to extend a lease if the remaining term is less than 80 years. Your buyer will be informed by their conveyancing lawyer if this is not already known. Leaseholders are strongly advised to extend their leases before the remaining term falls to less than 80 years, regardless of whether they intend to sell the flat.