It’s an underpublicised truth that a Holborn residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Holborn property prices.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term drops below eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most leasehold owners in Holborn will be able to extend under the legislation; however a lawyer will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Irrespective of whether you are a tenant or a freeholder in Holborn,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Holborn valuers.
In the wake of 6 months of protracted discussions with the freeholder of her ground floor flat in Holborn, Olivia started the lease extension process just as the lease was approaching the crucial 80-year threshold. The legal work completed in July 2005. The landlord’s charges were negotiated to slightly above five hundred pounds.
Last year we were called by Dr V Martin , who bought a one bedroom flat in Holborn in June 1995. The question was if we could approximate the premium could be for a ninety year lease extension. Similar homes in Holborn with a long lease were in the region of £191,400. The mid-range ground rent payable was £55 invoiced monthly. The lease terminated on 15 April 2080. Having 54 years outstanding we estimated the compensation to the freeholder to extend the lease to be within £34,200 and £39,600 plus fees.
An example of a Lease Extension matter before the tribunal for a Holborn flat is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case affected 1 flat. The unexpired term as at the valuation date was 66.8 years.