Petts Wood leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Petts Wood residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Petts Wood you should investigate if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an additional 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 |
|---|---|
| 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. |
| Bank of Scotland | 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Retaining our service gives you increased control over the value of your Petts Wood leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Eli, started to get close to the eighty-year mark with the lease on his garden apartment in Petts Wood. In buying his flat 19 years ago, the lease term was of little relevance. Luckily, he realised he needed to take steps soon on Extending the lease. Eli was able to extend his lease at the eleventh hour in July. Eli and the landlord in the end agreed on sum of £5,500 . If he had missed the deadline, the amount would have escalated by at least £1,125.
Last Autumn we were phoned by Mr and Mrs. D Cooper , who took over the lease of a basement flat in Petts Wood in November 2007. The dilemma was if we could shed any light on how much (roughly) premium could be for a ninety year lease extension. Comparable premises in Petts Wood with an extended lease were valued about £243,000. The average amount of ground rent was £65 invoiced annually. The lease concluded on 28 October 2089. Given that there were 63 years remaining we calculated the compensation to the freeholder for the lease extension to be within £20,000 and £23,000 not including professional charges.
An example of a Lease Extension decision for a Petts Wood flat is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case related to 1 flat. The unexpired term as at the valuation date was 50.57 years.