It’s a harsh certainty that a Durham residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Durham property market.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term dips under 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Durham will be able to extend under the legislation; however a lawyer should be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold premises in Durham with more than 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| Birmingham Midshires | |
| Nationwide Building Society | |
| The Mortgage Works | |
| Virgin |
Regardless of whether you are a tenant or a landlord in Durham,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Durham valuers.
Last October Jake, started to get close to the eighty-year mark with the lease on his ground floor flat in Durham. Having bought his flat two decades ago, the length of the lease was of minimal bearing. Luckily, he realised he would imminently be paying way over the odds for a lease extension. Jake was able to extend his lease just under the wire in July. Jake and the landlord in the end agreed on a premium of £5,000 . If the lease had fallen lower than eighty years, the premium would have gone up by a minimum £875.
Mr Benjamin Cooper owned a basement apartment in Durham in October 2007. The dilemma was if we could approximate the premium would be to extend the lease by 90 years. Comparative premises in Durham with 100 year plus lease were in the region of £235,200. The mid-range ground rent payable was £45 collected quarterly. The lease concluded in 2092. Considering the 66 years left we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including fees.
Last Autumn we were called by Mr and Mrs. U Howard , who bought a one bedroom apartment in Durham in May 1999. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by ninety years. Comparative properties in Durham with an extended lease were valued around £280,000. The mid-range amount of ground rent was £55 invoiced quarterly. The lease terminated on 28 March 2103. Taking into account 77 years left we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 not including costs.