It’s a harsh truth that a Tolworth residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Tolworth property prices.Where your lease has approximately ninety years left, you need to start considering a lease extension. If the number of years remaining slips below eighty years, you will end up paying 50% 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 extra value that a lease extension will add the property Most leasehold owners in Tolworth will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer for the duration of the formalities.
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence 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. |
| 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. |
| 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. |
| 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 |
The conveyancing solicitors that we work with undertake Tolworth 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 conveyancer we work with provide it.
Trailing protracted correspondence with the landlord of her basement flat in Tolworth, Kayleigh commenced the lease extension process as the 80 year threshold was fast advancing. The transaction was finalised in November 2010. The freeholder’s fees were restricted to a tad over 600 pounds.
In 2010 we were contacted by Mr and Mrs. L Martin who, having moved into a ground floor apartment in Tolworth in June 2001. The question was if we could approximate the premium would likely be to prolong the lease by an additional years. Comparable properties in Tolworth with a long lease were valued about £198,800. The average amount of ground rent was £55 collected every twelve months. The lease terminated on 14 September 2080. Having 55 years remaining we calculated the premium to the freeholder to extend the lease to be between £33,300 and £38,400 plus professional charges.
An example of a Lease Extension matter before the tribunal for a Tolworth residence is Flat D 15 Claremont Gardens in September 2013. TheTribunal determined in accordance with section48 and Schedule13 of the Leasehold Reform,Housing and Urban Development Act 1993 that the premium for the extended lease should be fourteen thousand one hundred and eighty seven pounds (£14,187.00) This case related to 1 flat.