Why you should commence your Colchester lease extension

Top reasons for lease extension now:

A Colchester leasehold property depreciates with the years remaining on the lease.

Colchester leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Colchester residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Colchester you really ought to check if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value

Colchester property with a lease extension has roughly the same value as a freehold

It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.

Mortgage lenders may not finance a property with a short lease

The propensity since over the last decade has been for mortgage companies to tighten lending requirements across the board - this has extended to the types of security over which the home loan is to be granted. This has resulted in the unexpired lease term required by mortgage companies has increased. In the past mortgage companies would lend on a lease with twenty years plus the term of the loan - typically fifty year leases but those requirements have been chipped away by the requirement for lengthy leases - many now have a minimum term of 75 years as standard.

Why use us for your lease extension in Colchester?

Regardless of whether you are a tenant or a landlord in Colchester,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Colchester valuers.

Colchester Lease Extension Case Summaries:

Rory, Colchester, Essex,

Rory owned a studio apartment in Colchester being marketed with a lease of a few days over 61 years remaining. Rory on an informal basis approached his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 annually. No ground rent would be payable on a lease extension were Rory to exercise his statutory right. Rory obtained expert advice and secured an acceptable resolution without resorting to tribunal and readily saleable.

Colchester case:

Mr Jude Stewart bought a one bedroom apartment in Colchester in February 2007. We are asked if we could estimate the premium could be to extend the lease by ninety years. Comparative flats in Colchester with 100 year plus lease were valued around £191,000. The mid-range ground rent payable was £65 invoiced every twelve months. The lease came to a finish on 11 September 2083. Considering the 58 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £23,800 and £27,400 exclusive of legals.

Colchester case:

In 2009 we were called by Ms Laura David who, having acquired a first floor apartment in Colchester in February 1997. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar flats in Colchester with a long lease were in the region of £250,000. The mid-range ground rent payable was £50 collected quarterly. The lease came to a finish in 2094. Considering the 69 years outstanding we approximated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus professional charges.