It’s an underpublicised truth that a Mottingham 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 early years due to the depreciation being disguised by increases in the Mottingham property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Mottingham will be able to extend under the legislation; however a lawyer will be able to confirm if you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold properties in Mottingham with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The lawyers that we work with undertake Mottingham lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
After lengthy discussions with the landlord of her studio flat in Mottingham, Sophie started the lease extension process just as her lease was approaching the all-important eighty-year mark. The transaction was finalised in August 2009. The freeholder’s costs were negotiated to about 700 pounds.
Last Spring we were called by Mr and Mrs. N Flores , who acquired a one bedroom flat in Mottingham in August 2010. The question was if we could shed any light on how much (roughly) price could be to extend the lease by ninety years. Comparable properties in Mottingham with an extended lease were in the region of £260,200. The average ground rent payable was £65 billed per annum. The lease lapsed in 2092. Given that there were 66 years left we estimated the compensation to the freeholder to extend the lease to be between £15,200 and £17,600 plus costs.
An example of a Lease Extension decision for a Mottingham residence is 49 Woodstock Court Burnt Ash Hill in May 2012. the payment of £64,116 by the leaseholder was the premium which the Tribunal found due for the lease extension in this case. This case affected 1 flat. The unexpired lease term was 23.26 years.