UK Landlord Forum / Life

Hello beautiful people- my first here, hoping someone can shed some light.
I have an ex council property in Redbridge which has 82 years lease left. I am getting conflicting views from various people on whether to extend or wait for the leaseholder reform bill to be implemented.
I know if I leave the lease to go below 80 years I will be hit with marriage value etc which is going to be very expensive.

Can someone please shed some light/thoughts on what  I should do? This is a BTL.

What is marriage value? 

Personally I would wait a bit longer, unless you envisage selling up soon. 

Quote from: heavykarma on June 28, 2024, 10:16:10 AMWhat is marriage value? 

Personally I would wait a bit longer, unless you envisage selling up soon. 

where do i get marriage value from? would it be in the lease?

You get a marriage value from a valuing surveyor.

But it's currently zero and the Leaseholder Reform Act is now law, so you're not waiting for anything. If Labour win the general election they've indicated that the Act needs to be improved, but it's hard to imagine it will be a priority, given that there's just been some legislation.

Quote from: jpkeates on June 29, 2024, 12:11:10 PMYou get a marriage value from a valuing surveyor.

But it's currently zero and the Leaseholder Reform Act is now law, so you're not waiting for anything. If Labour win the general election they've indicated that the Act needs to be improved, but it's hard to imagine it will be a priority, given that there's just been some legislation.

marriage value is not currently zero from what i understand as the Act is not implemented until 2025/26?

It's not something I've done in practice, but I thought it was zero for a lease over 80 years. You might need to check that, though.

I extended a lease a couple of years ago. Due to incompetent solicitors and a difficult management company the process took about 4 years and was extremely stressful. Good luck whatever you decide to do!

16  of us leaseholders set up a company to get/extend the freehold. At the time the lease had 64 years left.Now 999 years. Like Denzy,it dragged on for years, cost me a fortune for 3 studios. The big incentive we were assured  of was that the values would increase greatly. Not so, none of those who have sold since have seen any benefits. In fact, the prospect of having to join a group of directors puts some people off. They are not wrong!

The future should be better.

I will hang-fire on any action in this space until the dust settles... whatever the current Government failed to do (capping Ground Rents and things like that) may actually come to pass with the next. I understand there was a lot of resistance from Pension Funds around this specific measure (I assume 'cos Ground Rents are one of their safer investment vehicles) but something will happen as I don't believe the recent trend of inflating Ground Rents can be seen as much more than a bilk. Whatever you say about this country that's negative, injustices, like Ground Rents increasing in-line with inflation every few years, may take time to get called-out, recognised and acted upon... but, in the long-run, they mostly do.

It's almost as if the people who created these terms for buying Leasehold properties didn't realise how they accelerate every five years or so, and how people would end up, in due course, being forced out of their home 'cos the Ground Rent is beyond their reach.

It might not end up being a peppercorn, but there was talk of a £250 per year cap that might be a happy compromise. Investors can accommodate for that, probably. But it's when Ground Rents are heading towards £1,000 and beyond that people start to realise it's just an opaque con..

The OP's opening post talks about marriage value, so it's clear they're not on-the-ball in this regard.

Is marriage value now the wrong term?

Quote from: Hippogriff on June 30, 2024, 09:00:47 AMThe future should be better.

I will hang-fire on any action in this space until the dust settles... whatever the current Government failed to do (capping Ground Rents and things like that) may actually come to pass with the next. I understand there was a lot of resistance from Pension Funds around this specific measure (I assume 'cos Ground Rents are one of their safer investment vehicles) but something will happen as I don't believe the recent trend of inflating Ground Rents can be seen as much more than a bilk. Whatever you say about this country that's negative, injustices, like Ground Rents increasing in-line with inflation every few years, may take time to get called-out, recognised and acted upon... but, in the long-run, they mostly do.

It's almost as if the people who created these terms for buying Leasehold properties didn't realise how they accelerate every five years or so, and how people would end up, in due course, being forced out of their home 'cos the Ground Rent is beyond their reach.

It might not end up being a peppercorn, but there was talk of a £250 per year cap that might be a happy compromise. Investors can accommodate for that, probably. But it's when Ground Rents are heading towards £1,000 and beyond that people start to realise it's just an opaque con..

The OP's opening post talks about marriage value, so it's clear they're not on-the-ball in this regard.

what are the risks if i hang on and this doesn't get implemented? now I am faced with a mortgage renewal and less than 80 years lease and a marriage value to pay also?

So many many reasons why I regret buying leasehold flats. I was so green I did not have a clue (or care)   what the term meant. I know my old-  school solicitor must  have given me a good talking- to about it at some point,  but I was bouncing back from a bad time and determined to stop fretting about details. One good thing though, there was a peppercorn ground- rent, and that never went up. I have heard  some real horror stories  on the subject. 

Quote from: tommys85 on June 30, 2024, 09:28:08 AMwhat are the risks if i hang on and this doesn't get implemented? now I am faced with a mortgage renewal and less than 80 years lease and a marriage value to pay also?

I suppose everything has risks, and some are hard to quantify. I just re-state I don't intend to take any action in the Leasehold properties I'm, unfortunately, involved in. I don't have any time pressure, so maybe that's a difference here - but, in actuality, that would be just one more reason for me to hold-off (if that makes sense - a rash decision, or decision under pressure, often being a poor decision when looked at in the rear-view mirror).

Suffice to say - advice that's particular to your situation is probably not best provided on an Internet forum.