When it comes to domestic leasehold premises in Petts Wood, you are in fact renting it for a certain period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially when there are fewer than eighty years left. Leasehold owners in Petts Wood with a lease approaching 81 years unexpired should seriously consider extending it as soon as possible. When a lease has fewer than eighty years outstanding, under the relevant Act the freeholder can calculate and charge a larger amount, assessed on a technical calculation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Petts Wood,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Petts Wood valuers.
Half a year ago Dylan, came dangerously near to the 80-year mark with the lease on his one bedroom apartment in Petts Wood. In buying his home 19 years ago, the lease term was of minimal concern. Fortunately, he recognised he would soon be paying an escalated premium for Extending the lease. Dylan was able to extend his lease at the eleventh hour in January. Dylan and the freeholder via the management company subsequently settled on sum of £5,500 . If the lease had fallen below eighty years, the amount would have gone up by at least £875.
In 2012 we were e-mailed by Dr Reuben Taylor who, having was assigned a lease of a studio flat in Petts Wood in January 2008. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparable properties in Petts Wood with a long lease were worth £191,400. The average amount of ground rent was £55 collected quarterly. The lease terminated on 11 March 2079. Taking into account 54 years left we approximated the compensation to the freeholder to extend the lease to be between £34,200 and £39,600 plus expenses.
An example of a Lease Extension matter before the tribunal 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 lease term was 50.57 years.