Edmonton leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. It is the case that most Edmonton tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Edmonton you must see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold residencies in Edmonton with more than 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Engaging our service gives you better control over the value of your Edmonton leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Theo, came precariously close to the eighty-year threshold with the lease on his leasehold apartment in Edmonton. In buying his home two decades ago, the length of the lease was of little bearing. Fortunately, he noticed he would imminently be paying an inflated amount for Extending the lease. Theo was able to extend his lease at the eleventh hour in May. Theo and the freeholder via the managing agents ultimately agreed on an amount of £5,500 . If the lease had dropped lower than 80 years, the figure would have escalated by a minimum £1,150.
In 2014 we were phoned by Mr K López who, having was assigned a lease of a basement flat in Edmonton in April 1998. The question was if we could estimate the price would likely be for a ninety year lease extension. Comparative premises in Edmonton with 100 year plus lease were in the region of £255,000. The mid-range ground rent payable was £50 billed yearly. The lease finished on 8 July 2096. Taking into account 71 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus legals.
An example of a Vesting Order and Purchase of freehold case for a Edmonton property is Ground Floor Flat 4A Baronet Road in February 2010. Following a vesting order by Edmonton County Court on 23rd December 2008 (case number 8ED064) the Tribunal decided that the price that the Applicant for the freehold interest should pay is £8,689.00 This case related to 2 flats. The remaining number of years on the lease was 80.01 years.