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F E Smith
F E Smith, Advocate
Category: Law
Satisfied Customers: 9576
Experience:  I have been practising for 30 years.
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I own am the freeholder of number of houses in England with

Resolved Question:

I own am the freeholder of number of houses in England with 990 year leases which commenced around 1940.
I am being told that the maximum return if I sell each freehold is around £200
And that the value of the land is irrelevant. Surely if a lease were to run it’s full term I would be entitled to the land (and the buildings on it).
So where in law does it say I must forfeit the price of the land and why. And is there any EEC rule relevant here.
With thanks
Submitted: 1 year ago.
Category: Law
Expert:  F E Smith replied 1 year ago.

Because of the length of the lease, and because it’s unlikely that any purchaser of the freehold is going to wait another 900 years to get the fee for a statutory lease extension, the freehold of a property with even the balance of 990 year lease is negligible.

In all honesty, even the £200 valuation is probably overstated but many leaseholders will pay that just so that they can say they have the freehold. It’s of very little value to them.

What you have been told is correct, the value of the land is irrelevant because the timescale that would elapse and the fact that currently, there is a statutory requirement that you would have to grant a new lease. Hence, while you think you may be entitled to the land the end of the lease, you are not. Of course, in the next 900 years legislation may change the moment that valuation is based upon the current law.

There is nothing in EU law which is the least bit relevant. There is nothing that says you must forfeit the price, but there is a statutory calculation for the price of a lease extension. However as mentioned, that would bring in another 900 years so is largely academic.

I wish I could give you a more favourable answer but unfortunately, what you have been told is correct.

Can I clarify anything for you?

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We can still exchange emails.

Best wishes.

FES.

F E Smith and 3 other Law Specialists are ready to help you
Customer: replied 1 year ago.
The answer is acceptable but does not mention the 1967 act for development.