With a domestic leasehold premises in Southgate, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. Modern 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 extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are less than eighty years remaining. Anyone in Southgate with a lease drawing near to 81 years left should seriously consider extending it as soon as possible. Once a lease has under eighty years left, under the relevant Act the landlord is entitled to calculate and demand a larger premium, based on a technical computation, known as “marriage value” which is due.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a landlord in Southgate,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Southgate valuers.
In 2014 Jasper, started to get near to the 80-year mark with the lease on his ground floor apartment in Southgate. Having bought his flat 19 years previously, the length of the lease was of minimal importance. Fortunately, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Jasper arranged for a lease extension just under the wire in July. Jasper and the landlord subsequently agreed on sum of £5,500 . If he had missed the deadline, the price would have gone up by a minimum £875.
Dr Nathaniel Scott bought a recently refurbished flat in Southgate in June 2002. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Similar premises in Southgate with 100 year plus lease were in the region of £280,000. The average ground rent payable was £45 billed monthly. The lease lapsed in 2097. Taking into account 71 years left we estimated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Southgate premises is 23 Beaconsfield Road in July 2013. The Tribunals decided that the amount payable was £31,203 for the freehold. This case related to 2 flats. The remaining number of years on the lease was 70.31 years.