Coulsdon leases on domestic properties are gradually losing value. Where your lease has in the region of ninety years left, you should start considering the need for a lease extension. If lease term is less than eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Coulsdon will usually be legally entitled to a lease extension; however a solicitor will confirm if you qualify. In some situations you may not be entitled. There are prescribed deadlines and procedures to comply with once the process is triggered so it’s sensible to be guided by a lawyer during the process.
Leasehold properties in Coulsdon with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Irrespective of whether you are a tenant or a freeholder in Coulsdon,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Coulsdon valuers.
After protracted discussions with the landlord of her purpose-built apartment in Coulsdon, Millie commenced the lease extension process just as the lease was nearing the crucial eighty-year deadline. The legal work was finalised in August 2005. The landlord’s charges were kept to an absolute minimum.
Last Christmas we were approach by Ms F Morris , who moved into a basement flat in Coulsdon in August 2007. The question was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparative flats in Coulsdon with an extended lease were in the region of £280,000. The mid-range amount of ground rent was £55 collected per annum. The lease lapsed in 2103. Given that there were 77 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus professional charges.
An example of a Freehold Enfranchisement case for a Coulsdon flat is 223 Brighton Road in September 2013. The premium payable for the acquisition freehold of the properties should be £10,934 (Ten thousand,nine hundred and thirty four pounds) This case was in relation to 3 flats. The unexpired lease term was 75 years.