Saleability of your flat is one of the most important reasons for a lease extension. The majority of buyers will run away from a short lease because they know they will find it difficult to get a mortgage from a high street lender.
The problem becomes more complicated as the required length of a lease varies from lender to lender and is determined by the individual lender.
You can do a quick phone around to various banks and building society's and discover for yourself the minimum unexpired lease term each accepts. The Woolwich will not lend on property with a lease less than 30 years longer than the term of the mortgage ie 55 years on an average 25 year mortgage.
The Halifax stipulates 35 years longer than the mortgage term whereas the Bristol and West offers on 70 year leases. Call up others such as the Bradford & Bingley, Co-op, Prudential, Sainsbury's et al, and create your own table of results.
If your lease is due to drop below 70 years remaining then it is definitely advisable to request a leasehold extension before you try to sell your property.
When an apartment first goes on the market, an estate agent may dismiss the years remaining on the lease as an irrelevance. It may be tempting to feel secure and cushioned by such an approach when you are keen to sell. However, beware: it is unlikely a buyer will overlook this detail. If the lease is approaching the limit of bank lending, they are likely to see a serious issue ahead and back off to calmer waters. This will be down the road, to the alternative dwelling with a longer lease on offer.
Individual cases may of course be considered differently and your personal funds may have some impact on a lender's criteria of judgement. This would be something that you should get approval for before you proceed. It would not be wise to go ahead before you thoroughly check the facts and make specific appointments to verify your case.
So, in answer to that oh so common question: 'when is the most appropriate time for a leasehold extension?', the best action to take in to ensure that your flat has enough years remaining on the lease to meet the requirements of the majority of high street lenders, this should increase the sale appeal of the property. These will be the lenders that your prospective buyer will most likely be approaching for a mortgage. And don't forget, if you decide to go ahead with a lease extension, make sure you point a solicitor specialising in this complex area.
The idea is that you want your flat to be open to as many buyers as possible to avoid stress and panic when selling - and therefore, the incorrect decision.