Clerkenwell leases on domestic deteriorating in value. Where your lease has in the region of ninety years remaining, you should start considering the need for a lease extension. If lease term is under eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Clerkenwell will mostly qualify for a lease extension; however It would be wise to check with a lawyer to confirm if you qualify. In certain cases you may not qualify. There are prescribed timetables and formalities to follow once the process has commenced so it’s wise to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety 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. |
| Birmingham Midshires | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Lease extensions in Clerkenwell can be a difficult process. We recommend you get guidance from a conveyancer and surveyor with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Clerkenwell lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last October Milo, started to get close to the eighty-year mark with the lease on his two bedroom apartment in Clerkenwell. Having bought his flat two decades ago, the unexpired term was of minimal interest. by good luck, he noticed he needed to take action soon on Extending the lease. Milo was able to extend his lease just under the wire last April. Milo and the freeholder via the managing agents eventually settled on a premium of £5,500 . If the lease had dropped lower than eighty years, the sum would have escalated by a minimum £1,150.
In 2009 we were phoned by Mr and Mrs. L Vincent who, having completed a purpose-built flat in Clerkenwell in May 1996. We are asked if we could estimate the price could be to prolong the lease by ninety years. Similar homes in Clerkenwell with 100 year plus lease were in the region of £218,000. The average ground rent payable was £45 collected annually. The lease ended on 16 June 2088. Having 63 years remaining we approximated the premium to the landlord to extend the lease to be within £17,100 and £19,800 plus costs.
An example of a Lease Extension matter before the tribunal for a Clerkenwell property is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case affected 1 flat. The remaining number of years on the lease was 66.8 years.