Owners of leasehold flats need to keep track of a crucial number – how many years they have left on their lease – and to act fast to extend it before it slips below 80.
The number of years left can prove crucial at the point of selling or remortgaging as a leasehold property theoretically gives owners the right to live there for only a limited time.
The land it stands on is owned by a freeholder or landlord who charges ground rent and will ultimately own the flat when the lease runs out.
Flat leases normally run for 99 or 125 years from when the property is built. Although, in theory, the flat is returned to the freeholder when the lease expires – leaving the person who has paid the mortgage empty-handed – in reality most leases are extended well before this happens.
The lease length is important as mortgage lenders have minimum requirements relating to the remaining term