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Joshua
Joshua, Lawyer
Category: Property Law
Satisfied Customers: 25451
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Hello I live in a 1st floor purpose built maisonette with

Resolved Question:

Hello

I live in a 1st floor purpose built maisonette with a short lease (47 years left). The ground floor maisonette has 189 year lease.
We have the option to purchase the lease and for me this would be the preferred option as the cost will be similar . (The owner of the other property is happy to purchase the lease)

Can you please advise me on how much each of us should pay given the difference in lease years?

many thanks for your help
Submitted: 3 years ago.
Category: Property Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

May I kindly clarify with you - do you refer to purchasing the freehold of the building please?

Customer:

yes

Joshua :

Thanks. Has a price been proposed for the freehold by the current owner?

Customer:

yes a few months ago, we are now ready to purchase but think it will be increased

Joshua :

Thanks. Could you tell me the approximate value of your flat and your neighbours flat at present and the annual ground rent you both pay?

Customer:

My flat is worth £300,000

Customer:

the ground floor is £320,000 and we both pay £36 per annum ground rent

Joshua :

Thanks. Finally may I ask the price proposed by the freeholder?

Customer:

it was £56,000 + legal fees in November 2013

Joshua :

Thanks. the length of time left on your respective leases as you will be well aware makes a very large difference to the premium payable in respect of the acquisition the freehold.

Customer:

yes I understand, this is why I need the percentage difference and also is this a good thing to do?

Joshua :

Based upon my calculations, the price of the freehold in respect of your lease would be between £69-79K and the price of your neighbour would be £500. these calculations without the benefit of the formal valuation survey and therefore will be more limited than the value of a formal valuation however one can see that unfortunately the overwhelming proportion of the cost would lie on your shoulders given the relative differences between the cost of the freehold to acquire. Obviously the freeholder is prepared to part with his interest in the freehold for a valuation which is lower than the above figures this is all well and good however the neighbours percentage share of any acquisition cost on the above figures is going to fall somewhere with the 1-2% range though of course you could open negotiations on something much substantial in the hope that the neighbour agrees

Customer:

Oh wow that is a huge difference, I hope he doesn't increase it to £79k

Customer:

my neighbour will be happy about their amount

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