Why you should commence your Basildon lease extension

Why you should commence your Basildon lease extension today:

A Basildon lease depreciates with the years remaining on the lease.

Unfortunately that a Basildon residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Basildon property prices.Once your lease gets to 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below 80 years - otherwise a higher premium will be payable. Most flat owners in Basildon will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.

An extended lease has roughly the same value as a freehold

It is generally accepted 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 premises will be worth the same as a freehold for many years ahead.

Lenders may not finance a property with a short lease

The trend since 2008 has been for mortgage companies to tighten lending criteria across the board - this has extended to the property over which the home loan is to be granted. This has resulted in the minimum number of years remaining under the lease required by lenders has increased. Historically banks would grant a mortgage on a lease with 25 years plus the term of the loan - typically 50 year leases but those requirements are being increasingly undermined by the requirement for longer and longer leases - many use a minimum term of 75 years as standard.

What makes us experts in Basildon lease extensions?

The conveyancing solicitors that we work with procure Basildon 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 conveyancing solicitor we work with provide it.

Basildon Lease Extension Case Studies:

Sam, Basildon, Essex,

Sam was the the leasehold owner of a conversion apartment in Basildon being sold with a lease of a few days over 59 years outstanding. Sam on an informal basis spoke with his freeholder being a well known Manchester-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Sam to exercise his statutory right. Sam procured expert legal guidance and was able to make an informed decision and deal with the matter and sell the property.

Basildon case:

In 2014 we were contacted by Mr and Mrs. K Cooper who, having moved into a one bedroom flat in Basildon in May 1995. The dilemma was if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable properties in Basildon with 100 year plus lease were in the region of £280,000. The average ground rent payable was £45 collected monthly. The lease terminated on 2 February 2096. Considering the 70 years remaining we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.

Basildon case:

In 2009 we were called by Mr and Mrs. U Watson who, having purchased a one bedroom apartment in Basildon in October 1995. The dilemma was if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Comparative flats in Basildon with an extended lease were in the region of £223,400. The average amount of ground rent was £60 billed per annum. The lease terminated in 2085. Considering the 59 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £27,600 and £31,800 plus expenses.