Hi all,

Looking for some advice.

My current GR is £100 pa, but in approx 16 years time will increase to 0.20% of the property value (1/500th as per lease), which is then reviewed at further 25 yr intervals until the end of the lease in c113 years time. So while there is no immediate need to serve a s24 to extend my lease because of length,I need to consider this soon because at some point I will need to buy out the rising ground rent before 2036.

Does anyone know how you value a flat in 16 years time and then in 41 years time and so on, because that will impact the premium to buy out the lease. I have done my own calculations based on what the property is worth today (c450k), based on a capitalisation rate of 4.5% (am not sure how realistic that is but I can easily change it to 3% and 5% to see the impact on the premium). Reversion to Freehold will obv add additional cost but that won't be a big cost due to term of current lease (113 years).

The other complication is whether I simply sit on this and wait for the leasehold reform bill which may bring some clarity around cap rates, valuing rising ground rents such as mine.

I don't think ill rush into doing anything at this point, as its not massively onerous compared to say doubling or RPI ground rents, but I feel it is prudent to get an idea of the cost now to buy out the GR, and maybe then see what happens in the next year or 2 with leasehold reform.

I could pay for a desktop valuation from a surveyor which I may well do, but thought id canvass opinion here first to see if anyone else has experience of this type of lease cost.

Any help/comments would be greatly appreciated.

Looking for some advice.

My current GR is £100 pa, but in approx 16 years time will increase to 0.20% of the property value (1/500th as per lease), which is then reviewed at further 25 yr intervals until the end of the lease in c113 years time. So while there is no immediate need to serve a s24 to extend my lease because of length,I need to consider this soon because at some point I will need to buy out the rising ground rent before 2036.

Does anyone know how you value a flat in 16 years time and then in 41 years time and so on, because that will impact the premium to buy out the lease. I have done my own calculations based on what the property is worth today (c450k), based on a capitalisation rate of 4.5% (am not sure how realistic that is but I can easily change it to 3% and 5% to see the impact on the premium). Reversion to Freehold will obv add additional cost but that won't be a big cost due to term of current lease (113 years).

The other complication is whether I simply sit on this and wait for the leasehold reform bill which may bring some clarity around cap rates, valuing rising ground rents such as mine.

I don't think ill rush into doing anything at this point, as its not massively onerous compared to say doubling or RPI ground rents, but I feel it is prudent to get an idea of the cost now to buy out the GR, and maybe then see what happens in the next year or 2 with leasehold reform.

I could pay for a desktop valuation from a surveyor which I may well do, but thought id canvass opinion here first to see if anyone else has experience of this type of lease cost.

Any help/comments would be greatly appreciated.

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