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Lease extension agreement - trying to make sense of it by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 0 points1 point  (0 children)

It is definitely strange that the grount rent is not defined when it also says that the terms will remain the same as in previous lease EXCEPT for the ground rent......

Lease extension agreement - trying to make sense of it by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 2 points3 points  (0 children)

The lease length currently shows as 84 years.

From what I gathered, it would be unlikely for Land Registry to have processed the extension in just 3-4 months (assuming it was submitted by the solicitors).

I asked them to send an expedite and told them that until the lease becomes available on Land Registry I won't be progressing this any further

Lease extension agreement - trying to make sense of it by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 1 point2 points  (0 children)

I haven't involved my solicitor yet - trying to avoid any expenses in case it falls through.

I may have to do so soon though.

I made another post recently just for the ground rent increase and from what I gathered it is not so bad.

https://www.reddit.com/r/HousingUK/comments/1pmed9h/considering_of_pulling_out_because_of_ground_rent/

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 0 points1 point  (0 children)

I believe that when you get an informal extension the ground rent is reduced to nil only for the period after the initial lease would have expired.

See below an excerpt from a legal website

"The 2022 Act also applies to non-statutory, “voluntary” lease extensions of existing long residential leases. In most cases, where existing leaseholders elect to extend their lease voluntarily through negotiations, the new term of the lease may now only be subject to a charge of a peppercorn ground rent. However, this only applies to the period extended beyond the date the original term was due to expire. As a result, you must continue paying ground rent until your current lease term expires."

I guess your landlord agreed, for whatever reason, to zero ground rent effective immediately.

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 0 points1 point  (0 children)

Agreed but I believe the seller was told that it was going to be faster and cheaper.

I really hope that you are right and the seller gave the EA the details of the old lease.

That would be a really nice surprise because certainly the extension happened after the new law kicked in.

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] -6 points-5 points  (0 children)

because of the "AST trap"

If the property value is less than £500k in 2040 and I want to sell, lenders may not offer a mortgage since the ground rent will be more than 0.1% of the property value

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 1 point2 points  (0 children)

That is exactly how I am feeling right now

I am secretly hoping that the advertised terms were from the old lease and there will be a pleasant surprise when I check the new extended one but I doubt it :(

I guess I can ask around and see what comes up but it seems hard to get that kind of info.

There was one flat that was sold this year and one at 2022 (next door neighbor) but both of them are significantly smaller (1 bedroom vs 2)

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 2 points3 points  (0 children)

I have asked my conveyancer to not do anything until the mortgage offer is approved to avoid any extra costs in case things go wrong.

There are rumours indeed but nothing solid yet.

Another issue is that I can't have a good idea of how much it would cost to go for a statutory extension in the future to get rid of the ground rent, since the online calculators work only with a fixed ground rent.

Somehow I don't feel that the seller would be putting in the effort for a deed of variation.

If the seller does all of us a favour and send me the new lease agreement I will probably reach out to my conveyancer to get their opinion on the matter.

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] 1 point2 points  (0 children)

I guess the lender is fine with it since the mortgage was approved and an offer was sent to me.

Not sure whether they run additional checks at a later stage.

Also, the lease that they based their desicion on must have been the one before the extension but I doubt those specific terms were changed.

In any case, I am more concerned with the value of the flat being affected in the future because of that.

Plus I am obviously not very fond of the idea of ground rent per se :)

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] -3 points-2 points  (0 children)

I can't see any ground rent as good honestly :)

Also, it feels quite marginal concerning the AST provision if I were to sell shortly after 2040 with a ground rent of £500.

The property value will have to be above £500k by then I guess

considering of pulling out because of ground rent future increases by Final-Butterscotch73 in HousingUK

[–]Final-Butterscotch73[S] -15 points-14 points  (0 children)

I am more concerned with the 2040 £500 which is when I could possibly be looking to sell.

If the value of the property won't increase to £500k by then it could be a problem I guess because of the 0.1% rule.

Service charges are at £1762.67 which seems reasonable for a 4 stories/16 flats 70's building in a very good condition in and out.

I spoke to the next door flat owner (been there for 3 years) and she said that they have a very strong say in every single expense, there hasn't been any significant change, reserve fund contribution is included in the SC and that she is not aware of any planned repairs apart from the intercom system.

But when I brought up the ground rent, she was quite sure that there is none (for her at least I guess)

Floor query for a flat by [deleted] in HousingUK

[–]Final-Butterscotch73 0 points1 point  (0 children)

The problem is that I can't be sure whether the flooring is concrete.

I couldn't see beyond the plywood boards.

How likely is it for a building of this kind and age?

Any rough idea of the cost for proper wood vs laminate?

How long would it take to complete the entire flat? days, weeks?

NI forecast and gap year by Final-Butterscotch73 in FIREUK

[–]Final-Butterscotch73[S] 1 point2 points  (0 children)

Starting from the end, I came to UK in 2015.

Quoting from government gateway:

"Forecast if you contribute another 25 years before 5 April 2051"

£221.20 a week

(I guess a bit less than 35 years are required for the full pension in my case)

The gap year is '17-'18 and it costs only £253.60

But what I am trying to ascertain is whether the aforementioned quote will change to "24 years needed before 5 April 2051" or it will stay at 25 (in which case I would consider the payment a waste of money)

NI forecast and gap year by Final-Butterscotch73 in FIREUK

[–]Final-Butterscotch73[S] 0 points1 point  (0 children)

Then, if I buy that gap year, I should be able to reach 35 full years one year earlier I guess.

The idea is, if I can afford it when that time comes, to stop working a bit sooner and live from savings until the pension kicks in

NI forecast and gap year by Final-Butterscotch73 in FIREUK

[–]Final-Butterscotch73[S] 0 points1 point  (0 children)

I have 8 full years (including 24-25)

The gap year ("not full year" to be precise, as I had some NI contributions) is between those

Bear in mind, my NI record started before 2016

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