Mildmay leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Mildmay enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Mildmay you would be well advised to see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold residencies in Mildmay with more than 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. 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 |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service will provide you increased control over the value of your Mildmay leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Evan owned a studio flat in Mildmay being sold with a lease of a few days over 72 years remaining. Evan on an informal basis contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Evan to exercise his statutory right. Evan obtained expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
In 2009 we were contacted by Mr and Mrs. N Allen who, having took over the lease of a ground floor flat in Mildmay in April 2006. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Similar flats in Mildmay with a long lease were worth £300,000. The mid-range amount of ground rent was £50 billed yearly. The lease came to a finish in 2101. Considering the 76 years left we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including expenses.
In 2011 we were called by Ms Niamh White who, having purchased a first floor flat in Mildmay in August 1998. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a 90 year extension to my lease. Identical flats in Mildmay with an extended lease were valued around £257,800. The mid-range amount of ground rent was £65 collected per annum. The lease came to a finish in 2090. Having 65 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £18,100 and £20,800 not including expenses.