A conveyancing firm claims there has been a 140 per cent increase in the number of properties requiring leasehold extensions in just the past four years - and that 10,000 transactions a year may be affected by this issue by 2020.
My Home Move says the relatively high number of leases created during the height of the 1970s and 80s development boom are now getting ‘older’ while demand for leasehold properties is increasing as more first time buyers join the property ladder.
“Buying a leasehold property, such as a flat, is often the only affordable option for a first time buyer. However, these transactions can often come with hidden surprises in the guise of short leases, ground rent arrears and sinking funds, making them more complicated and expensive than buyers realise” claims Doug Crawford, My Home Move chief executive.
“We estimate that thousands of properties will enter the market over the coming months with short leases, costing sellers tens of thousands of pounds to extend, resulting in additional delays to home movers and, in particular, first time buyers as they work to secure a mortgage. This added pressure, on an already over-extended housing market, could cause some real problems” he claims.