Why you should start your March lease extension

Why you should start your March lease extension today:

Increase your lease and increase your March property value

It’s a harsh certainty that a March residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the March property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If the number of years remaining dips under 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 March will be able to extend under the legislation; however a conveyancer will be able to clarify if you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.

An extended lease has roughly the same value as a freehold

Leasehold residencies in March with more than one hundred years unexpired 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 property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.

Banks and Building Societies may decide not to issue a mortgage with a short lease

Mortgage lenders have set criteria when loaning funds charged on leasehold homes. Many will simply not lend at all once an unexpired lease term goes beneath a specified unexpired lease term. Many Banks and Building Societies will not consider property with an unexpired term of less than seventy years as adequate security. As well as impacting your ability to sell, it is also relevant where you are wanting to remortgage your March property.

Get in touch with one of our March lease extension solicitors or enfranchisement solicitors

Irrespective of whether you are a tenant or a landlord in March,the lease extension experts 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 March valuers.

March Lease Extension Example Cases:

Natasha, March, Cambridgeshire,

Trailing lengthy correspondence with the freeholder of her ground floor flat in March, Natasha commenced the lease extension process just as her lease was approaching the critical eighty-year mark. The legal work was finalised in November 2006. The landlord’s costs were kept to an absolute minimum.

March case:

Mr and Mrs. L Stewart purchased a one bedroom flat in March in September 2008. The question was if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparative homes in March with an extended lease were valued around £205,000. The average ground rent payable was £50 invoiced annually. The lease finished in 2104. Taking into account 78 years remaining we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus professional charges.

March case:

Mr and Mrs. R Torres moved into a purpose-built flat in March in February 2004. The question was if we could approximate the price would be for a ninety year extension to my lease. Similar homes in March with 100 year plus lease were worth £267,600. The mid-range ground rent payable was £65 collected every twelve months. The lease finished in 2093. Considering the 67 years remaining we calculated the premium to the landlord for the lease extension to be between £14,300 and £16,400 not including legals.