With a residential leasehold premises in March, you are in fact renting it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably when there are less than 80 years left. Residents in March with a lease approaching 81 years remaining should seriously consider extending it as soon as possible. When the lease term has under 80 years outstanding, under the relevant Act the freeholder can calculate and charge a larger premium, based on a technical multiplication, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| Barnsley Building Society | |
| Nationwide Building Society | |
| Santander | |
| Virgin |
Lease extensions in March can be a difficult process. We recommend you obtain guidance from a lawyer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring March lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Andrew was the the leasehold proprietor of a 2 bedroom flat in March being marketed with a lease of just over 72 years outstanding. Andrew on an informal basis approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Andrew to exercise his statutory right. Andrew procured expert advice and secured an acceptable deal informally and ending up with a market value flat.
Last Christmas we were called by Dr L Reed , who moved into a first floor apartment in March in October 2005. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Identical premises in March with a long lease were in the region of £280,000. The mid-range ground rent payable was £45 collected every twelve months. The lease ended on 10 July 2096. Having 70 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus expenses.
In 2010 we were contacted by Ms C Lee who, having completed a basement apartment in March in June 2011. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Identical homes in March with an extended lease were valued around £223,400. The average amount of ground rent was £60 collected quarterly. The lease finished in 2085. Considering the 59 years remaining we estimated the compensation to the freeholder to extend the lease to be between £27,600 and £31,800 exclusive of costs.