Selling A Flat With A Short Lease In 2024

The rising popularity of serviced apartments attracts guests seeking hotel-like comforts while maintaining their privacy. To stand out among the competition and increase profitability, it’s crucial to enhance your marketing strategies for your multiple properties in town.

Selling a flat with a short lease involves complexities and considerations. Understanding the implications on sale price, duration, and potential constraints is crucial. Despite hurdles, with careful planning and professional guidance, successful transactions are attainable.

What is a short lease?

Properties with a lease under 80 years are considered short. This varies by location, like London, where flats often have shorter leases. Initially, properties typically have leases of 99-999 years, with some as low as 70 years.

Short leases can deter first-time buyers, but companies like Home House Buyers specialize in quick sales, aiming to help sellers get the best value.

Is it possible to extend a short lease on a property?

Many property owners, grappling with short leases, explore the option of extending them. Extending a lease is a viable route within the framework of existing property laws and regulations. It’s a step that can alleviate the concerns and uncertainties associated with short lease terms.

Estimating the cost of extending a lease presents a challenge. While tools like leasehold calculators offer rough estimates, precise figures require a more formal approach. This entails serving a section 42 notice, as stipulated in the Leasehold Reform, Housing, and Urban Development Act of 1993. This legal provision grants leaseholders the right to seek a 90-year extension on their lease. The initiation of this statutory leasehold extension process hinges on the service of a section 42 notice to the freeholder or landlord. This serves as the official commencement of negotiations regarding lease extension terms and costs.

How long does the process of extending a lease take?

If you’re considering extending the short lease on your flat, the process typically begins with hiring a surveyor to evaluate the property. The surveyor’s valuation is then forwarded to your solicitor. Subsequently, your solicitor serves a section 42 notice to your landlord or freeholder, indicating the premium you propose to pay for the lease extension. Following this, the landlord or freeholder has a two-month window to either accept the extension or respond with a counter-notice.

In most cases, negotiations are settled outside of court, unless an agreement on the premium cannot be reached. Your and the landlord/freeholder’s surveyors will play key roles in negotiating a suitable premium for the lease extension. With smooth cooperation between the parties involved, the lease extension process can be completed in as little as two months.

Can you sell a short lease property?

If you’re not considering extending your lease, you might wonder about selling your property. The answer is yes, it’s possible. Every property holds some value, allowing for the sale of a flat with a short lease. However, sellers should anticipate that properties with exceptionally short leases might not fetch high prices. Such sales are typically pursued when capital is needed urgently.

Many estate agents shy away from selling properties with short leases. However, sellers have other options available. One effective approach is to sell on the open market, preferably targeting cash buyers. Clear advertisement stating the property’s short lease status and pricing accordingly is crucial.

With the right guidance, selling a flat with a short lease can be manageable. Seeking advice from solicitors well-versed in property market dynamics and lease issues is essential. These experts can assist in obtaining a section 42 notice, initiating the process of extending the lease on your property.